The sharp decline in oil prices has severely affected
Venezuela’s oil-driven economy. The country’s economy is shrinking at a rate of
8% per annum—the worst rate globally. Inflation has reached 700% while the IMF
(International Monetary Fund) projects it will cross 1,600% in 2017. Amid the
crisis, Venezuelan bonds (IAGG) (IGOV) have sunk to a new low, while the yield
has surged to a record high. According to Datastream, Venezuelan dollar bonds
on average have returned an impressive 14.1% so far this year. However, with
the current economic crisis, Venezuelan bonds’ risk-reward ratio seems to be
unfavorable. No wonder Venezuela’s BSRI score has experienced the largest
decline in the world. More… 
Thursday, October 6, 2016
How the World’s Sovereign Bonds Stack Up
The sharp decline in oil prices has severely affected
Venezuela’s oil-driven economy. The country’s economy is shrinking at a rate of
8% per annum—the worst rate globally. Inflation has reached 700% while the IMF
(International Monetary Fund) projects it will cross 1,600% in 2017. Amid the
crisis, Venezuelan bonds (IAGG) (IGOV) have sunk to a new low, while the yield
has surged to a record high. According to Datastream, Venezuelan dollar bonds
on average have returned an impressive 14.1% so far this year. However, with
the current economic crisis, Venezuelan bonds’ risk-reward ratio seems to be
unfavorable. No wonder Venezuela’s BSRI score has experienced the largest
decline in the world. More…
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