The EMBIG Peru indicator decreased 9 basis points to 207 between March 22 and 29, the
Central Reserve Bank (BCR) reported.
Meanwhile, the EMBIG Latin America indicator decreased 15 bps to 469 bps, amid an environment of lower stress in the global financial sector.
According to the BCR, the interest rate on Peru's 10-year sovereign bonds, which fell by 10 bps between March 22 and 29, remains one of the lowest in the region.
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/RMB
Published: 4/2/2023