The terms of an international bailout for Portugal may allow it to push back targets for cutting its budget deficit, a central bank official said on Monday, but a European Commission source said it was not clear that such a compromise was possible, Reuters reported. The Commission, the European Central Bank and the International Monetary Fund have been discussing conditions of the rescue with Portugal's caretaker government for three weeks. Terms are likely to be announced in coming days, perhaps as soon as on Wednesday, official sources familiar with the talks said. Last month, debt-ridden Portugal became the euro zone's third state to ask for a bailout, following months of soaring borrowing costs and the collapse of its government. Emergency loans extended in the multi-year rescue are expected to total about 80 billion euros ($118 billion). Publicly, officials have refused to comment on progress in the talks, beyond saying a deal is expected to be reached in time for it to be approved by a mid-May meeting of European finance ministers. But ECB Vice President Vitor Constancio was quoted as saying by Portugal's Lusa news agency in Brussels on Monday that the timing of the country's budget deficit targets, which it agreed last year with the Commission, might be eased. "This is a valid discussion. I think a consensus will be reached, acceptable to the three institutions and to Portugal." Portuguese media and analysts said international donors appeared willing to let Lisbon push back the targets in recognition of the fact that aiming for over-ambitious goals could be counter-productive by damaging Portugal's economy. "Perhaps it shows they learned some lessons from Greece and Ireland," which agreed on bailouts last year, said Ralph Solveen, an economist at Commerzbank. He noted that Greece had so far failed to meet its deficit goals and Ireland had made limited progress, while their economies shrank and their bond yields continued to climb. -- SPA
