LISBON, Portugal -- Bailed-out Portugal has lowered the financial hurdle it must clear next year when a hefty debt repayment falls due by exchanging bonds worth (EURO)3.76 billion ($4.86 billion) for longer-term bills.
Bonds valued at almost (EURO)10 billion are due to mature next September in the first major test of Portugal's financial health since it needed a (EURO)78 billion rescue in May last year.
The government debt agency said Wednesday it swopped 38.5 percent of that debt for bonds maturing in October 2015.
That reduces the debt Portugal will have to cover in September to just under (EURO)6 billion, giving it some breathing space as it struggles to restore market confidence.
The Bank of Portugal predicts an economic contraction of 3.3 percent this year. Unemployment is at a record 15.9 percent.