Venezuela Bulls Find Reasons to Be Optimistic as Bonds Rally
- Bondholders say they received payment on PDVSA 2017 bond
- Five-year implied probability of sovereign default hits 100%
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Speculation that President Nicolas Maduro will default on Venezuela’s debt has sent credit-default swaps skyrocketing to records as the clock runs out on debt payments.
Traders have become so pessimistic that swaps contracts now imply unheard-of 100 percent odds that the oil-rich nation will default on its sovereign bonds during the next five years, with the prevailing theory being that the socialist leader will favor full stomachs over Wall Street ahead of next year’s presidential election.