This site uses cookies to provide you with a great user experience. By using BondbloX, you accept our use of cookies.
Bond Market News
Colombia’s Dollar Bonds Ease Amid Reports of Fiscal Rule Suspension
June 6, 2025
Colombia’s dollar bonds eased on Thursday, following local media reports suggesting that the government might suspend its long-standing fiscal rule. The rule, over a decade old, limits budget spending and is believed to have provided a crucial anchor for financial plans to steady markets and limit government debt. W Radio stated that the government’s fiscal committee is deliberating on activating an “escape clause” within the rule. This would allow them to suspend the rule under exceptional circumstances. However, central bank board member Mauricio Villamizar warned against it, emphasizing no justified need for this, adding that it could lead to potential macroeconomic instability. Analysts anticipate a wider fiscal gap for 2025, with some forecasting a deficit exceeding 7% of GDP, a level not seen since the pandemic. This is a significant increase from the government’s earlier projection of 5.1% of GDP for 2025. Experts caution that suspending the rule could send a negative market signal, increase borrowing costs and harm fiscal sustainability. The fiscal committee plans to announce a new budget next week.
Colombia’s dollar bonds had fallen by over 3% in April after its access to an $8.1bn credit line was paused by the IMF. However they have recovered the entire move since then. Its 7.375% 2037s are trading at 96, yielding 7.9%.
For more details, click here.
Go back to Latest bond Market News
Related Posts:
Credit rating boost for Ireland & Portugal: EU inches towards recovery
September 20, 2017
China Refutes S&P Downgrade Action
September 26, 2017
BondbloX Pte. Ltd. is regulated by the Monetary Authority of Singapore as a Recognised Market Operator ("RMO") and exempted from Section 49(1) of the Securities and Futures Act (Cap. 289) ("SFA") under Section 49(7) of the SFA.