Peru's country risk indicator decreased from 173 to 162 basis points between March 4 and 11, as measured by the EMBIG Peru spread, the Central Reserve Bank (BCR) said today.
Likewise, the EMBIG Latin America spread fell 7 bps amid labor market recovery in the United States and European Central Bank’s decision to keep the interest rate.
The country risk measures the ability of a country to meet its financial obligations and the implicit political risk, and based on that, the country 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 that the risk of doing business in a country is more or less high.
(END) JJN/EEP
Published: 3/15/2014