Sovereign Report

Sovereign Report


Brazil Rides S&P Upgrade and US Rate CutBrazil swooped into the markets in the first week of the new year with a remarkably well-timed $1.5 billion, five-year issue managed by Morgan Stanley Dean Witter that underlined the country's increasingly sophisticated approach to the capital markets. The issue came shortly after Standard & Poor's long-awaited upgrade of Brazil to BB- and coincided with the Federal Reserve's 50 basis point cut in US interest rates to 6%. This allowed Brazil to sell more paper at a lower-than-expected yield of 10.54%. MSDW's Brendan Goffinet, says Brazil "wanted to get funding early in the year" and the central bank decided to act while emerging market technicals l

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