Portugal buffeted by Greek budget storm

Portugal is under pressure to convince investors that its public finances are under control - a tough job for the Socialist government after the country's credit rating was downgraded.
Prime Minister Jose Socrates has been briefing parliament on the government's austerity plans. He says Portugal is being targeted by "speculative attacks".
His room for manoeuvre may be limited as the markets probe eurozone weaknesses and many investors now see Portugal through a Greek prism. Portugal's growth depends largely on its trading partners.
This week the ratings agency Standard & Poor's lowered Portugal's credit rating two notches, sending yields on its euro-denominated bonds to record highs. So investors are demanding a higher price for lending to Portugal.
The People's Party, the smaller of two centre-right groups in parliament, also blames speculators but says the government failed to act decisively and thus left the economy vulnerable.
Party leader Paulo Portas warned of the impact as the cost of borrowing rises, "on a banking sector that will have difficulty financing itself, on companies that face losing access to some or all credit, on families that may see their mortgage payments increase in the medium term, and above all on economic confidence".
In 2009 Portugal's budget deficit reached 9.3% of gross domestic product and the public debt rose to 77% of GDP.