Economy & Business - October 2006

Mexico became the first country in the region to launch a long-dated fixed-rate bond in local currency. On 24 October it sold M$2bn (US$182m) of 30 year peso bonds at a yield of 8.08%, significantly better than what trading on the pre-market had indicated. The main reason why the yield was lower than the 8.26% that the grey (or pre-) market had expected was that demand for the paper was huge. The treasury had bids worth M$12.6bn (or for 6.3 times the amount of paper the government was offering).