Investors Brush Off Downgrade Risk and Pile Into Colombian Debt

• International investors are piling back into Colombian bonds amid optimism the economy is poised to recover from its worst downturn on record, brushing off risk the nation could lose investment-grade credit status.
• Foreign demand for the local debt hit a record in September, with net inflows of 5.3Tn pesos ($1.4Bn), leaving overseas investors holding a total of about $21.4Bn, according to the Finance Ministry. It marked the fifth consecutive month of increases after investors sold off emerging-market assets as the coronavirus lockdowns accelerated in March.
• While there is uncertainty over whether a second outbreak may cause another wave of lockdowns, Lopez forecasts a 4.2% rebound in 2021. The government expects the economy to contract 5.5% this year, the worst since record-keeping began more than a century ago.

(Source: Bloomberg)