After the resignation of two high profile ministers in two days, Reuters and local media are now reporting that further resignations are expected. Last night Prime Minister Pedro Passos Coelho said that he would not "resign or abandon" his country.
One of those ministers - the leader of the coalition government's junior partner - departed yesterday. This is likely to spark further announcements, according to think tank Open Europe, who suggests that the junior party leaving the coalition is now likely.
Ministers for Social Security and Agriculture are now expected to follow the leader of their party - the conservative Popular party - and announce that they will quit this morning.
The yields on 10-year government bonds have now surged to over eight per cent, for the first time since 27 November, as markets expect that this could derail Portugal's austerity programme.
In May, Portugal issued €3bn in 10y debt in a heavily-oversubscribed issue. It's now worth €2.5bn. http://t.co/agspnN7Zbn— Paweł Morski (@Pawelmorski) July 3, 2013
Portugal's Banks Slump; BES -11%, BCP -14%, BPI -10% [dj]>> oh boy oh boy— Katie Martin (@katie_martin_FX) July 3, 2013
According to local media more Portuguese ministers to resign, but don't worry, according to French President Hollande the crisis is over— Michael Hewson (@michaelhewson) July 3, 2013