The downward trend in the behavior of US treasury bonds would benefit the placement of $ 1.5 billion in Eurobonds by Costa Rica for the coming weeks.
This was determined by an analysis conducted by ACOBO, noting that the trends in the US market have been down, which could mean that the placement is made in better financial conditions for Costa Rica.
The best scenario for the placement of Costa Rica’s external debt is that the yield on US bonds tends to decline. Over the course of this year, the yield on 10-year Treasury bonds has reduced 100 basis points,”
said Luis Diego Herrera, an analyst at Acobo.
The conditions for accessing foreign market financing are different from those of the previous year for the country. Due to the fiscal tightness of 2018 Costa Rica paid very high returns last year.
The issuance of Eurobonds seeks to improve the conditions of rates and terms for public debt, and thus reduce the pressures that exist on interest rates. This drop in rates is necessary for economic recovery.
The bank loan became more expensive at the end of 2018, which affects the growth of the economy because the level of rates does not encourage Costa Ricans to take on new loans. If the Ministry of Finance reduces its participation in the demand for more resources in the local market, interest rates will not have excessive upward pressure, encouraging demand for loans,”
explained Herrera.