Analysts predict a second bailout

Investors have a 50% chance of sharing losses in Irish government debt and the country will need a second financing package after the current programme comes to an end, Citigroup and Moody’s said yesterday.

Citigroup economist Michael Sunders said: “We still expect a sizeable growth undershoot and deficit overshoot, and expect Ireland will need a second financing package, which may include PSI (private sector involvement), beyond 2013”.

Moody’s, the credit rating agency, also believes Ireland will need access to money from the EU’s bailout fund, the ESM, but warns a no vote in the referendum on the fiscal treaty would block the country from the fund.