Andina

Peru: Country risk down to 135 basis points

Aerial view of Lima

Aerial view of Lima's financial center. Photo: ANDINA/Archive

00:06 | Lima, Jan. 19.

The EMBIG Peru spread registered 135 bps, while the EMBIG Latin America spread reached 402 bps on January 6-13, the Central Reserve Bank (BCR) has reported.

It means that the Peruvian indicator remained below the regional average.

According to the issuing entity, the result came amid fears over the new strains of the COVID-19 virus and the tighter restrictions implemented in several countries to reduce the spread of the pandemic.

About 

The country risk measures the ability of a country to meet its financial obligations and the implicit political risk and, based on that, receives an international credit rating.

The main consequences of a high country risk are a drop in foreign investment and lower economic growth, which could lead to unemployment and low wages.

This is an orientation index for investors, because it indicates the risk of doing business in a country is more or less high. 

It should be noted that the higher the risk, the less likely projects obtain a return in accordance with funds; and the lower this index is, the more attractive the country will be to investors.  

The index is measured based on the difference between the spread of Peru sovereign bonds over yield of U.S. Treasury bonds.

(END) NDP/MVB

Publicado: 19/1/2021
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