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Pakistan redeemed its 8.25% bond due April 15 as the nation tried to reassure investors about its ability to pay off offshore debts, having narrowly averted a default last year. The State Bank of Pakistan said that the principal and interest payments were made to the agent bank for distribution to the bondholders. Pakistan’s finances are being keenly watched amid high inflation and low forex reserves. After having secured $3bn in bailout funds from the IMF last year, it plans to seek a new loan of up to $8bn from the IMF, as per reports. Its dollar bonds featured among the top gainers in Q1, with a median return of ~18% across the curve.
Pakistan’s dollar bonds however were trading weaker by ~1 point across the curve, yielding 11-12%.