Latin America

Emerging market bond demand appeared near boiling point this week as a slew of borrowers priced new debt through their curves and even high yielding credits were able to stretch to longer maturities. While market participants acknowledged it surely cannot get any better than this and that conditions show little connection to economic reality, they are struggling to see what could sour sentiment in the near term. Mariam Meskin and Oliver West report.

Argentina’s recently restructured international bond curve looks further than ever from the 10% yield target that the finance minister had set. New currency controls aimed at halting the decline in international reserves have had a catastrophic impact on both corporate and sovereign bond markets, and are likely to spell major trouble in the long term, analysts say.

BBVA’s Mexican subsidiary made an opportunistic return to the international markets on Tuesday, raising dollar funding at a record low cost ahead of a bond maturing next March.

Argentine corporate bonds sold off sharply on Wednesday after the central bank sought to dictate how the issuers could refinance their dollar debt as part of an escalation of currency controls.

Brazilian foods company BRF fetched a 10 times oversubscribed order book on its way to a 30-year benchmark on Wednesday as appetite for Latin American risk remains irrepressible.

Latin American development bank Corporación Andina de Fomento (CAF) will continue to monitor its members’ needs before determining how much funding it has left to raise in 2020, but has covered the majority of its financing needs after increasing the size of a dollar benchmark, priced on Wednesday.

BBVA’s Mexican subsidiary, Bancomer, on Tuesday provided one of the clearest examples yet of the attractiveness of international bond markets for Latin American borrowers as it notched the lowest ever coupon on a dollar deal from a bank from the region.

South America’s largest corn-based ethanol producer, FS Agrisolutions Indústria de Biocombustíveis (FS), will look to become the latest Latin American borrower to sell a sustainability-themed bond as it proposes a green format for its international market debut.

Gonzalo García and Anthony Gutman have been named as co-heads of the investment banking division for Europe, the Middle East and Africa at Goldman Sachs. They take on what is a new position.

Seven months after it visited European investors to market the idea, Mexico sold the first sovereign bond explicitly aligned to the United Nations’ Sustainable Development Goals (SDG) on Monday, saying it was the first step on the way to building an external yield curve of sustainable bonds.

Mexican cement producer Cemex sold its second dollar bond in three months on Monday, fetching lower pricing at a longer maturity than on its June outing as observers saw a slim new issue concession amid what one analyst called recent “insatiable” demand for the credit.

Brazilian food company BRF is planning a new dollar bond to finance a buy-back of euro and dollar notes maturing between 2022 and 2026 as investors say the protein sector’s strong performance this year means conditions are ideal for liability management trades.