Fitch downgrades El Salvador’s sovereign rating to ‘CC’ after offering to buy back bonds

Fitch downgrades El Salvador’s sovereign rating to ‘CC’ after offering to buy back bonds

Fitch Ratings downgraded sovereign credit risk ratings on Thursday savior to β€œCC” from β€œCCC”, highlighting the fragile liquidity position, which could be further weakened by the announced repurchase offer for bonds due in 2023 and 2025.

At the beginning of the week, the Salvadoran government launched a deal of about $360 million that will be funded from resources from Special Drawing Rights (SDR) allocated by the state. International Monetary Fund and credit from the Central American Bank for Economic Integration.

“The liquidity situation in El Salvador is dire,” Fitch said in a report.

The maturities of the two papers add about $1,600 million.

Since July, authorities A country in Central America They reported their plans to carry out the operation in an effort to send a reassuring message to the markets at a time when there were fears of default due to their fragile economic situation.

The Salvadoran presidential house and finance ministry did not immediately respond to a request for comment.

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