Bloomberg News

Colombia Bond Yields Rise From Record Low; Peso Advances

November 28, 2012

Colombia’s peso bond yields rose, snapping nine days of declines, as investors speculated the rally which drove yields to a record low wasn’t sustainable.

The yield on the 10 percent debt due in July 2024 rose three basis points, or 0.03 percentage point, to 6 percent, according to the central bank. It fell to 5.97 percent yesterday, the lowest since the securities were first issued in 2009.

Banco de la Republica lowered the target lending rate by a quarter-percentage point to 4.5 percent on Nov. 23, surprising all except two of 33 analysts surveyed by Bloomberg. Yields on the bonds due in 2024 have fallen 9 basis points since the announcement.

“After so many days of declines, this was expected,” said Jorge Cardozo, an analyst at Corredores Asociados brokerage in Bogota. Still, “fundamentals remain the same and there is still room for further gains across the curve.”

The peso advanced for the first day in five, gaining 0.1 percent to 1,823.35 per U.S. dollar. The currency has appreciated 0.5 percent in November and risen 6.3 percent this year.

To contact the reporter on this story: Andrea Jaramillo in Bogota at ajaramillo1@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net


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