In late trading Portugal’s long-term borrowing costs on the market reached 8.473 percent against 8.409 percent at Friday’s close.

During the day the yield hit 8.5 percent, a new record since Portugal adopted the euro currency which topped a series of recent record levels.

Rates on benchmark Portuguese 10-year bonds have jumped above 8.0 percent, an unsustainable level for the long-term, since parliament rejected the government’s latest austerity package last month, forcing the prime minister to quit with fresh elections to be held on June 5.

Lisbon’s woes have been exacerbated by credit downgrades by international ratings agency.

Fitch Ratings on Friday slashed its credit rating on Portugal by three notches to BBB-, saying it is less likely the eurozone member would receive external support during its election campaign.

BBB- is the lowest investment-grade rating under Fitch’s system. It also kept Portugal on negative watch, meaning a further downgrade is possible.

On Thursday President Anibal Cavaco Silva called early general elections on June 5 after prime minister Jose Socrates, a socialist, resigned when parliament rejected the new austerity programme put forward by his minority government.

Finance Minister Fernando Teixeira dos Santos said Thursday the outgoing government had no authority to negotiate a rescue deal with the EU and the IMF but that he was “no longer so sure” that Lisbon could avoid asking for outside assistance.

His comments followed the release of figures that Portugal’s public deficit stood at 8.6 percent of output last year, well above the 7.3 percent government objective.

While Portugal’s government has so far insisted that the country will be able to make by without the kind of bailout which Greece and Ireland have been forced to accept, Fitch said it sees external assistance as necessary for Lisbon to sustainably manage its debt.

“Portugal cannot ask for aid before the elections… because there must first be a budgetary consolidation plan,” said Vincent Chaigneau, head of research at Societe Generale CIB.

Despite this context, the Portuguese debt agency indicated that it would try to raise between 750 million and one billion euros ($1 billion-1.4 billion) on Wednesday from short-term treasury bonds.

The tensions within the eurozone were amply displayed Monday by the difference between the Portuguese 10-year bond yield rate at well over eight percent, compared to that of powerhouse Germany where the rate was under 3.4 percent.