Prices lowers for Costa Rica's foreign debt bonds
The price of Costa Rica's foreign debt bonds fell in September after the financial crisis got worse.
Tuesday, October 14, 2008
The bond which has dropped the most is the one that will expire in 2020. This bond was selling at 132% in May of 2008, then on October 7 it dropped to 128%, and later to 118% on October 10.
An increase in the yields of U.S. Treasury bonds has increased the sale of bonds in dollars, impacting on Costa Rican bonds traded internationally and in the domestic market.
In the past 7 months, the price of bonds expiring in 2020 went from 105 to 120, while their yield dropped from 9.20% to 6.3%.
The current rates for investment in dollars available in Costa Rica represent attractive options- which are scarce right now, compared to the international markets.
The Monetary Authority of Guatemala decided, against the vote of banking representatives and private enterprise sectors, to increase debt through issuance by 10.9%.
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