Portugal Needs to Prepare to Tighten Budget, Dijsselbloem Says

Even though the European Commission accepted Portugal’s draft budget last week, Eurogroup President Jeroen Dijsselbloem said the nation needs to be prepared to do additional work to make sure it stays in line with the European Union’s economic targets.

“Portugal needs to stand ready, if necessary, to do more to stay within the pact,” Dijssselbloem said before a meeting of euro-area finance ministers in Brussels on Thursday. The new government has said they are “very committed to the growth and stability pact and that they are very committed to the budgetary rules,” he said.

Portugal’s 10-year bond yield jumped 81 basis points to 5.53 percent on Thursday, the highest since March 2014. The government on Friday cut the 2016 growth forecast to 1.8 percent.

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