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Colombian Outsider Has No Clear Plan That Investors Can Embrace

  • Hernandez faces Petro in presidential second round on June 19
  • Investors weigh risk of unknown against Petro’s anti-oil plans
Rodolfo Hernandez at a campaign event in Bucaramanga, Colombia, on June 5.

Rodolfo Hernandez at a campaign event in Bucaramanga, Colombia, on June 5.

Photographer: Natalia Ortiz Mantilla/Bloomberg
Updated on

Investors who celebrated the emergence of a TikTok-savvy businessman in Colombia’s presidential election are starting to see lingering risks for the bonds, even if the Andean nation’s next leader allows the oil-heavy economy to keep drilling.

Bonds have already slipped back to levels last seen before the first round of voting as money managers realize that scarce information about the economic policies of 77-year-old construction magnate Rodolfo Hernandez could prove just as risky as anti-oil leftist Gustavo Petro. Ten-year peso bond yields bounced back to 11%, higher than they were the last trading day before the vote. Dollar bonds due in 2045 slipped to the lowest since May 25, and the cost of insuring the nation’s debt against default over the next five years is hovering near pre-election levels.