Right now, the pressure on Ireland is rising as yields on the country’s 10-year debt have increased to 6%, according to The Irish Times.
The spread between the equivalent 10-year bund and Irish debt is now higher than in May, when the European sovereign debt crisis reached its current peak.
The dramatic increase to 6.011% looks even larger when compared to last week’s yield of 5.68%.
Simon Johnson at Baseline Scenario speculates that the country may actually be insolvent.
Now one of the country’s most expensive banking sector bailouts, that of Anglo Irish Bank, may need to expand to cover corporate deposits at the bank as the government winds down the business. That new amount of support may rise to €25 billion.
The country’s National Asset Management Agency, set up to bailout its failing banks, plans a bond auction for Thursday.
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