Chile places 1.5bn dollar-bonds at lowest financing cost of any emerging country

Friday, October 26th 2012 - 21:15 UTC

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Chile placed 1.5 billion in dollar-denominated bonds on international markets at historic yields, giving the country the lowest borrowing cost of any emerging country, Finance Minister Felipe Larrain said on Thursday. Read full article

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British_Kirchnerist
Can someone explain in layman's terms why Chile has the lowest costs, and whether this is agood thing or a bad thing?
Nov 01st, 2012 - 01:10 pm - Link - Report abuse 0
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piscolero
When a country sells bonds its taking on debt and the interest rate is the payment of that debt repayed in full at maturity (in fact part of the bond is to pay other maturing debts). So the lower the rate, the lower the borrowing costs, evidently a good thing!
As to why Chile has very low borrowing costs, there are many reasons most of which are explained in the article and include strong gdp growth, political stability, interest from investors (i.e. demand was 7 times higher than supply), an A+ rating etc.
Nov 04th, 2012 - 05:45 pm - Link - Report abuse 0
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