Bolivia’s bonds soared after a bill that would allow the central bank to sell its gold reserves passed a major hurdle in congress.
(Bloomberg) — Bolivia’s bonds soared after a bill that would allow the central bank to sell its gold reserves passed a major hurdle in congress.
The nation’s dollar bonds due 2028 rose for a sixth straight day, jumping 6.2 cents to 60.4 cents on the dollar, the biggest percentage gain since they were issued in 2017, according to indicative price data compiled by Bloomberg.
Lawmakers in the lower chamber approved the bill in general, and will start a debate over the details today, according to a congressional statement on social media. If the bill passes, it could ease the dollar shortage that has roiled the economy in recent months, and alarmed investors.
The central bank has spent nearly all its cash reserves and special drawing rights with the International Monetary Fund to defend its currency peg with the US dollar. But the monetary authority still has nearly $3 billion of gold, which could potentially buy the country some breathing room.
If approved by the chamber, the bill will pass to the senate for more discussion.
Read more: Financial Chaos at 12,000 Feet: Dollars Are Vanishing in Bolivia
Bolivia’s bonds also received a boost in recent days from comments by Sergio Diaz-Granados, Executive President of Corporation Andina de Fomento. He said in an interview that the multilateral lender is in advanced talks with the Andean nation to meet its financing needs for the year.
Read more: Bolivia in Advanced Talks for Financing Deal, CAF Says
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