Meanwhile Greece, which received a bail-out last year, denied reports that it would have to restructure its debts.
The euro lost 1% of its value against the dollar as a result of the reports.
It was trading at $1.4275. Against the pound, it was down 0.7% at 87.78 pence.
The yields on benchmark government bonds for both Portugal and Greece also reached their highest levels since the introduction of the euro in 1999 on concerns over the European debt crisis.
"Greece is in such a difficult position that restructuring appears unavoidable, sooner rather than later," Daniel Gros from the Central for European Policy Studies told BBC World.
"Most would say sooner would be better than later, but the politicians disagree, they would like to hold on as long as possible," he added.
Finland's parliament has the right to vote on EU requests to bail-out other countries. Potentially the strong showing of the True Finns could delay the rescue plan for Portugal. ”
Bank of Greece governor George Provopoulos said restructuring its debts - meaning changing the terms - was "neither necessary nor desirable".The General Confederation of Workers union, which has a million members, said it would hold a strike on 11 May to protest the austerity measures.
And the European Commission denied there were any talks being held on a possible restructuring of Greece's debt.
The market nervousness also spread to Spain, which had to pay sharply higher interest rates to borrow money for 12 months at an auction on Monday.
The heavily-indebted state, which has often been talked about as the next state that could face a sovereign debt crisis, paid a rate of 2.77%, up from 2.13% last month.
Officials have suggested that the terms of Portugal's rescue deal will be agreed by the middle of May.
It is the third member of the euro to seek a bail-out in just over a year.
Greece received 110bn euros in May last year, while the Irish Republic received a bail-out of about 85bn euros in November. Last Updated at 18 Apr 2011, 17:20 GMT *Chart shows local time
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Two Germans are leading the EU delegations - Juergen Kroeger for the European Commission and Rasmus Rueffer for the European Central Bank - while the IMF team is led by a Dane, Poul Thomsen.However, the finalisation of the Portuguese bail-out may be made more complicated by the strong showing of the True Finns party in recent elections in Finland. The True Finns are anti-euro and oppose the bail-out.
The European Financial Stability Facility, worth up to 440bn euros, is funded by members of the eurozone and requires unanimous consent to be used.
A hostile Finnish government could theoretically veto the package and, unlike other eurozone countries, Finland's parliament can vote on whether to approve the measures.
The European Commission tried to play down this possibility in light of the election.
"We fully expect Finland to honour its commitments made in terms of participation of Finland like the rest of the eurozone," it said.
In Portugal, the main opposition party is backing the caretaker government's bail-out bid, but many members of the public have been vocal in their opposition, the BBC's Alison Roberts reports.
"It is not clear how much more austerity will be able to be imposed, whichever government emerges from the June elections," our Lisbon correspondent says.
Public sector workers, who have already had their wages cut, are planning to strike at the beginning of May. There were also widespread protests involving young people last month over the lack of employment opportunities.
The government of Jose Socrates collapsed last month- prompting the bail-out - because he could not get an ambitious austerity and privatisation package passed.
But some economists suggest the IMF could take a softer line on the interest rate and duration of the loan compared with EU officials, who are under pressure from voters in member states that are putting up the money.
This is because the IMF forecast last week that Portugal's GDP would shrink this year and next.