According Fixed Income, Mexico placed the samurai bonds denominated in Yen

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According Fixed Income, Mexico placed the samurai bonds denominated in Yen

Bono samurai en México

The Mexico Finance Ministry affirmed that the Government made a 135,000-million-yen debt issuance, approximately 1,260 million dollars, designated in yen or Japanese currency and at record low interest rates for the country.

According to the report that was released to the public by the Mexico financial authority, the so-called as “samurai” bonds were placed in sections of 5, 7, 10 and 20 years.

Samurai bonds are a financial instrument that will give to the debt issuers the opportunity to join the capital in Japan’s economy. On the other hand, gains will give them the opportunity to change to local currency and be intended to the issue specific purposes.

The bonds with maturities in 2023, 2025, 2028 and 2038 grant a performance of 0.60 %, 0.85 %, 1.05 % and 2 %, respectively.

These instruments have been well received by the market. These papers’ demand exceeded 180 billion yen, about 1.3 times the amount that had been issued by Banxico.

The Mexican leading banking institution said that although the volatility observed by the financial international markets, the operation was very well received by investors and was carried out in favorable conditions for the government.

Banxico o, Mexico's Central Bank

Banxico o, Mexico’s Central Bank

The objectives to reach with this type of operations are to cover the needs of external financing, to guarantee a good credits management on the international markets and establishing new benchmark bonds to develop the performance curve of the country in the international markets.

The reference rate in Mexico has not moved

By the end of the day, the central bank of the country, known as Banxico, maintained a short term interest rate benchmark, that indicates for the moment, less depreciation risk of the Mexican peso that could be possible created by an unfavorable outcome for the North American Free Trade Agreement (NAFTA) negotiations amid inflation slowing.

The central bank left the overnight rate unchanged at 7.50%. The Mexico Governing Board made this unanimously decision and also ranked among the expectations line of the majority of analysts who were consulted by polling agency Reuters analysis.

In the other hand, Reuters said last time the rate was increased, this year in February, found between current levels, meaning the highest in the last 9 years and was a measure to prevent or curb inflation pressures.

However, in March the year inflation rate lost its momentum, to a 5.04% lowest level in more than a year. The figure is still far from being the permanent 3% target the Central Bank raised.

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