The FT explains the latest drama in the Portuguese government as today’s resignation of the foreign minister follows yesterday’s from the finance minister.
10-year yields have shot 15 basis points higher in the past hour.
Mr Portas’s decision plunges the centre-right government of Prime Minister Pedro Passos Coelho into crisis and threatens to undermine Lisbon’s efforts to exit its €78bn bailout programme by June 2014… Mr Portas is leader of the conservative Popular party (CDS-PP), the junior coalition partner in the two-party coalition government.
He said he was resigning in disagreement over the promotion of Maria Luís Albuquerque from Treasury secretary to replace Mr Gaspar as finance minister.
It’s not yet entirely clear why Gaspar resigned but he was a chief figure promoting austerity. The euro is beginning to soften on the worries. One high-ranking minister resigning could be anything, two is a symptom of a larger problem.