Market presses for pragmatism in Bolivia

Bolivian bonds tumbled on Tuesday after President-elect Luis Arce from the left-wing Movimiento al Socialismo (MAS) party claimed victory in this week’s election. Analysts and investors are hopeful that the next government will implement pragmatic policies to ensure economic stability. The country’s non-financial public sector debt was 58% of GDP at the end of 2019, and it expects to reach 66% in 2021, the International Monetary Fund (IMF) said in April. Bolivia owes most of its debt to multilateral institutions, but it also has $2 billion in outstanding principal in the international bond market. Bolivia’s US dollar-denominated debt was down in Tuesday’s action. The benchmark 4.5% 2028 issue dropped four points in price to bid 81.875, putting the yield at 8.2%, according to data provider Refinitiv.