Cost of Government borrowing hits record high

The cost of borrowing for the Government reached a record high this morning.

At one stage, investor yields being sought on 10-year Irish bonds rose to 7%,

the highest it has been in the history of the euro, before settling back down to around 5%.

Greek and Portuguese bonds are also under similar pressure this morning.

Senior dealer at National Irish Bank Owen Callan said that market sentiment is still turning against Ireland.

"The market obviously doesn't believe the position at the moment," he said.

"They believe that the Government's fiscal adjustment plan may potentially be too ambitious and that they won't be able to follow through on it."