Financing for the Post-pandemic Recovery: Developing Domestic Sovereign Debt Markets in Central America

Jean François Clevy, Guilherme Pedras and Esther Perez Ruiz

No 2021/283, IMF Working Papers from International Monetary Fund

Abstract: The pandemic has urged countries around the globe to mobilize financing to support the recovery. This is even more relevant in Central America, where the policy response to cushion the pandemic’s economic and social impact has accentuated pre-existing debt vulnerabilities. This paper documents the potential for local currency bond markets to diversify and expand financing for the recovery, lowering bond yields, funding volatility, and exposure to global shocks. The paper further identifies priority actions, both national and regional, to support market development.

Keywords: Bond Markets; Fiscal Deficit; Public Debt; Global Spillovers.; financing condition; pre-existing debt vulnerability; sovereign bond bond yield; market development; LCBM development; Yield curve; Securities markets; Government debt management; Government securities; Global; Central America (search for similar items in EconPapers)
Pages: 34
Date: 2021-12-03
New Economics Papers: this item is included in nep-fdg
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