Portugal has followed Greece and the Irish Republic in requesting an international bailout for its debt-ridden economy.

In a televised statement, the country's caretaker prime minister, Jose Socrates, said he had asked the European Union for emergency financial aid.

Economics editor Stephanie Flanders, told the programme that a "bridging loan" was being discussed, as full financial support could not be organised until an election had resolved a political stand-off.

EU affairs spokesman for Germany's CSU party Thomas Silberhorn cautioned that all a bail-out could do would be to "try and win time"

"Portugal now needs a chance to decide on the necessary internal reforms," he said.

Stephen Bell, chief economist at the hedge fund GLC, agreed, suggesting that the most important thing was that the crisis does not spread to Spain.

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