Eurozone crisis update

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Eurozone is back on the front page with some interesting developments, if you thought that we could forget about this crisis well...

Irish 10 Year bonds passed yesterday above 10%, for the first time in history. For all those who missed Citi's recommendation to buy Ireland CDS in advance of an event of default, the report can be found here.

In summary, Citi now believes that Ireland is essentially done for, or as Tom Fitzpatrick ever so more diplomatically puts it "things are about to get ugly".
Irish bank stress tests are due at the end of this month. The Government is thought to likely have a good idea of the results heading in to the EU summit later this week. ECB is set to raise rates and 80% of Irish mortgages are variable/ECB trackers. This has all the hallmarks of something that might start to get ugly.
European clearing house LCH.Clearnet raised the margin requirement on Irish government bonds to 35 percent from 30 percent on Thursday after a jump in Irish spreads on renewed concern it can service its debt in the longer-term.The move will make it more expensive to trade Irish sovereign debt, already a thinly traded paper, and underlines the scale of Ireland's debt crisis four months after a bailout was agreed with the EU/IMF.

Portugal in the meanwhile has lost its government and soon its sovereignity Portuguese PM resigned after the budget was rejected. This was expected, and it appears Portugal will be next in line for a bailout. The EU leaders meeting starts tomorrow.
Portugal needs to refinance around £4bn of bonds in April.
The Portuguese 10-year yield climbed 14 basis points to 7.63 percent, with the similar-maturity Greek yield up five basis points to 12.56 percent. The Portuguese five-year note yield rose to as much as 8.19 percent, the highest since before the euro was introduced in 1999. 

Fears that the European debt crisis may spread to Madrid were heightened this morning, when Moody's downgraded most of the Spanish banking sector.