Markets Climb After Noboa’s Victory in Ecuador; Bonds Surge 30%
Bonds now yield 13.14%, reflecting increased investor appetite and expectations of lower financing costs for the incoming administration.
Daniel Noboa’s victory in Ecuador’s presidential runoff triggered a wave of optimism in international markets on Monday.
The country’s sovereign bonds surged by as much as 30% in early trading, driven by hopes of greater political stability and fiscal relief.
The 2035 global bond, which was trading around 44 cents on the dollar prior to the election, climbed to 57.55 cents by midday. The bond now yields 13.14%, reflecting increased investor appetite and expectations of lower financing costs for the incoming administration.
The rally also points to a likely decline in Ecuador’s country risk. The risk premium stood at 1,844 basis points as of April 11, but traders expect it could drop by as much as 500 points in the coming days, depending on Noboa’s rhetoric and the initial signals his government sends to the market—potentially falling to around 1,300 or even 1,000 basis points.
Noboa assumed office amid a backdrop of political turmoil and escalating insecurity following the “cross-death” measure invoked by former president Guillermo Lasso in August 2023. Although Noboa declared a state of emergency after taking office, Ecuador experienced the most violent start to a year in its history in early 2025, with record-high homicide numbers.
Security remains one of Noboa’s top priorities. His government plans to seek international cooperation from the U.S., Canada, France, and Italy, among others, to enhance public safety. He also aims to modernize the armed forces and national police with new technologies and greater investment.
On the economic front—another key campaign issue—Noboa projects 4% GDP growth for Ecuador this year. His fiscal policy agenda includes continued austerity measures and efforts to boost revenue through higher taxes, including a recent hike in the VAT to 15%.
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