The European Union may provide financial assistance to Ireland, as fears grow that it might not be able to repay its huge debts.
The president of the European Commission, Jose Manuel Barroso, says the EU is ready to assist the Irish Republic "if needed", after the yield on government bonds hit record highs.
The BBC says the rise in the interest rate Irish government bonds pay out reflects growing fear among investors about the government's ability to cut its debt levels.
Italy and Spain were among the countries seeing their cost of borrowing jump as fears grew of contagion in Europe.
On Thursday, Irish 10-year government bond yields jumped to 8.929%, the highest level since the creation of the euro in 1999.
The Irish government has already imposed stringent cuts on civil service pay and state spending, and plans to unveil details of a further 15bn euros of cuts on 7 December.
They will include a further 6bn euros of cuts next year, designed to bring the budget deficit down to between 9.5-9.75% of GDP, the BBC reports.
The government's deficit surged during the recession after it was forced to bail out the country's banking system.
A number of European governments have announced wide-ranging spending cuts to reduce debt levels, most notably Greece, Portugal, Spain and the UK.