New Bonds: Braced for higher yields

Jan 1, 2014

Borrowers and bond investors are bracing for the impact this year of rising rates, but markets are set to stay busy. By Mariana Santibáñez

The US Federal Reserve’s December decision to begin winding down its $85 billion monthly quantitative easing program is likely to translate into higher interest rates for Latin American borrowers this year. That could make it tougher for lower-rated companies and countries to tap the market — although some demand is expected to remain for their higher yields. Investment bank Barclays forecasts a busy year for bond issuance, estimating Latin American corporates will sell around $110 billion worth of bonds in the dollar market alone. In 2013, Latin Americans — corporates and sovereigns — raised $160 billion from cross-border bond sales in the year...

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