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Colombia’s long-dated dollar bonds rose by 0.6-1 point as the government met with the US ambassador to ease diplomatic tensions that arose recently. The foreign ministry said that both countries “agreed that this is the first step toward resolving the current impasse in bilateral relations”. This comes after US President Donald Trump denounced Colombian President Gustavo Petro, adding that the US would halt all aid and impose fresh tariffs on the country. Colombia’s dollar bonds have ticked higher over the past week as the government announced its intention to continue repurchasing sovereign bonds as part of its strategy to revamp the country’s debt profile. Colombia’s liability management operations, have included local and dollar debt repurchases, the issuance of euro-denominated bonds for the first time in almost ten years and a $9.3bn total return swap. However, underlying fiscal and political concerns remain, with the deficit being the highest since the pandemic, in addition to the uncertainty around presidential elections next year.
Colombia’s 5.625% 2044s were higher by 0.6 points to trade at 83.9 cents on the dollar, yielding 7.2%.
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