EM LATAM CREDIT: MNI EM Credit: Latin America USD Bond Spread Movements MTD

• Low beta sovereign benchmark bond spreads moved about 25-30 bps tighter month to date and investment grade corporate bonds had a similar movement like Brazil’s Suzano 2031s 24 bps tighter and Gruma 2034s 25 bps tighter.

• High yield sovereign bonds were about 50-60 bps tighter while high yield corporate bonds were generally 50-100bps tighter. Some Brazil high yield names like AEGEBZ, MRFGBZ and CSNABZ were 90-100 bps tighter. Bonds of Brazil ethanol processor and fuel distributor Raizen (RAIZBZ) underperformed after disappointing earnings last week.

• Pemex outperformed with 2035 bonds 116bps tighter MTD as some reports came out with the view that the Mexican government would continue to financially support Pemex in the near term.

• Oil sensitive names like Brazil’s high yield rated Brava Energia (RRRPBZ) only tightened 37bps and Colombia’s government controlled Ecopetrol 2036 bonds moved in 45 bps with people still nervous about oil prices given the precipitous decline a few weeks ago.

• Ecuador bonds were the best performer in the sovereign high yield space, tightening 194 bps as market friendly president Noboa picked up support from the legislature that should help pass needed economic and security reforms.