Argentine Country Risk At 10-Year Low

Argentina’s country risk has fallen to its lowest level in 10 years driven by the performance of the country’s paper. According to JP Morgan’s Emerging Market Bond Index (EMBI), local yield spreads over US treasuries – a key gauge of investors’ aversion to risky assets – tightened to 317 basis points at the end of last week. At the height of Argentina’s economic crisis in 2001/02 the Argentina EMBI was over 6,500 basis points; the capital markets were effectively closed to the country.