Via Reuters:

Portugal’s parliament is expected to reject government austerity measures on Wednesday, setting the stage for the possible collapse of the minority Socialist administration a day before a European summit. Prime Minister Jose Socrates has said he will resign if the plan is defeated. He has said its rejection would force the debt-laden country to follow Greece and Ireland and seek an international bailout, which he opposes. All opposition parties have proposed resolutions calling for the rejection of the measures, which reduce pensions and state spending. The main opposition Social Democrats, who have previously backed austerity, have begun talking about a snap election.”If all these positions that now seem irreversible are confirmed, then yes (the government will step down),” Francisco Assis, Socialist bench leader in parliament, told reporters after a late-night party meeting…Portuguese benchmark 10-year bond yield rose to 7.77 percent on Wednesday from Tuesday’s 7.68 percent and the spread over safer German Bunds rose 7 basis points to 450 bps. Many economists see borrowing costs above 7 percent as unsustainable and say Portugal will have to resort to the rescue mechanism.