El Salvador Bonds Soar After Bukele Signals Zero Deficit
- Notes due in 2035 jumped to highest since 2021, best in EM
- Bank of America upgrades country’s debt to overweight
Nayib Bukele speaks during an event marking the 203rd anniversary of independence in Ciudad Arce, Libertad department, El Salvador, on September 15, 2024.
Photographer: Daniela Rodriguez/AFP/Getty ImagesThis article is for subscribers only.
El Salvador’s sovereign debt jumped Monday after President Nayib Bukele said the 2025 budget wouldn’t involve issuing new debt, signaling his plans for fiscal austerity, a key step in unlocking a long-awaited program with the International Monetary Fund.
Dollar notes rose across the curve, with those due in 2035 gaining 2.2 cents on the dollar to 80.5 cents, the highest since 2021, according to indicative pricing data compiled by Bloomberg. The yield for the bond dropped over 40 basis points to 10.7%.