bondsThe gap between Irish and German borrowing costs reached record levels at lunchtime today.

The gap has risen above five percentage points for the first time ever on bond markets.

The yield on Irish 10-year bonds rose to close to 7.6pc. At the same time German bunds sit below 2.5pc.

The spread between Irish bonds and the German bund has widened to 515 basis points.

The eurozone periphery countries of Portugal, Greece and Ireland are under pressure from the possibilities of permanent mechanisms for debt crisis resolution.

The latest sharp sell-off of these periphery euro zone bonds began on Friday after EU proposals on debt restructuring raised the possibility of bondholders having to share the burden in a default.