31 March 2011 at 13:24 GMT
Standard & Poor's downgrade of Portugal's sovereign credit rating to just above junk bond status and resultant soaring bond yields to new post Euro highs moves Portugal one step closer to a bailout. The outlook is grim with the country's economy expected to shrink 1.4% in 2011 and scheduled redemptions of debt posing challenges ahead. Furthermore, elections will need to be held soon to fill the leadership gap following the recent resignation of the country's prime minister. So, the question is: for how much longer can Portugal keep its head in the sand and hold off from asking for a financial rescue package?