Among other things we warned that “default seems inevitable in the medium term due to the prolonged period of low oil prices and increased US sanctions. President Trump’s executive order of August 24, 2017, strengthened sanctions against PDVSA by prohibiting all transactions related to new debt with a maturity greater than 90 days and by forbidding Citgo from repatriating dividends in Venezuela.”
It adds that “several holders of bonds due in 2027 haven’t received a payment”, and that an “official at the public credit office in Caracas declined to comment on whether the funds have been transferred or when investors will receive them.”
Further suggesting that Venezuela may have indeed entered its 30 day grace period, the country’s National Office of Public Credit hasn’t made any public statements about transferring funds for the coupon. In the past, Bloomberg notes that the office has used its Twitter account to alert the market when the bond’s fiscal agent has been paid.
For now the bond market appears to not have noticed with Venezuela bond issues still trading at respectable levels.
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