MercoPress. South Atlantic News Agency

Peru's credit risk, EMBIG, stands at 183 points, less than half the region's average

The country risk measures the ability of a country to meet its financial obligations and the implicit political risk and, based on that, receives a global credit rating

Peru's EMBIG (Emerging Markets Bond Index Global) spread stood at 183 basis points, while the EMBIG Latin America spread increased 52 bps to 494 bps on September 16-23, the Central Reserve Bank (BCR) has reported.

It means that the Peruvian indicator remained below the regional average.

According to the issuing entity, the result came amid concern about new measures to contain the novel coronavirus.

The country risk measures the ability of a country to meet its financial obligations and the implicit political risk and, based on that, receives an international credit rating.

The main consequences of a high country risk are a drop in foreign investment and lower economic growth, which could lead to unemployment and low wages.

This is an orientation index for investors, because it indicates the risk of doing business in a country is more or less high.

It should be noted that the higher the risk, the less likely projects obtain a return in accordance with funds; and the lower this index is, the more attractive the country will be to investors.

The index is measured based on the difference between the spread of Peru sovereign bonds over yield of U.S. Treasury bonds.