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It would make sense for Portugal to seek aid from the European Union bailout fund, although such a decision will be caught up in domestic politics, European Central Bank Governing Board member Ewald Nowotny said.
Ireland's two largest parties agreed to form a new coalition government Sunday, clinching a quick deal that will allow it to press European leaders to ease the terms of the country's 85 billion euro EU/IMF bailout.
Ireland's parliament approved a multi-billion euro EU/IMF bailout package on Wednesday in the face of opposition threats to renegotiate the deal to force losses on some senior bondholders in Irish banks.
The ultimate size will depend on whether Dublin merely tries to shore up and restructure its crippled banks, or whether a larger package is offered to give it more breathing room.