Peruvian dollar bonds fell, pushing up yields for the first time in three days, on concern slowing Chinese manufacturing activity may curb demand for copper, the Andean nation’s top export.
The yield on Peru’s benchmark 6.55 percent dollar-denominated bond due March 2037 rose one basis point, or 0.01 percentage point, to 4.68 percent at 1:21 p.m. in Lima. The price fell 0.24 cent to 127.30 cents per dollar.
Copper fell to a two-week low in New York after a preliminary Chinese purchasing managers’ index from HSBC Holdings Plc and Markit Economics dropped to the lowest since November and signaled a contraction in manufacturing activity. The data added to concern the world’s second-largest economy is slowing after retail sales and home prices declined.
“It’s very evident that growth is starting to reduce and there’s less demand overall for base commodities and industrial metals,” said Enrique Alvarez, the head of Latin America fixed-income research at IdeaGlobal in New York. “Negatives from China are inevitably negatives for Latin America, and Peru, Chile and Brazil in particular.”
China overtook the U.S. to become Peru’s biggest export market last year on rising purchases of gold, iron ore and fishmeal.
The sol was little changed at 2.6695 per U.S. dollar, from 2.67 yesterday.