Uruguay Sells Swiss Franc Bonds for the First Time, Seeks Flexibility and Lower Costs

Uruguay has sold bonds in Swiss francs for the first time, raising about 320 million francs, which is close to 400 million US dollars. The government made this move to help cover its expected budget gap for 2025, which is around 6 billion dollars.

The bonds come in two parts: one matures in five years with a 1.04% interest rate, and the other in ten years with a 1.62% rate. The average interest rate is 1.33% per year.

This step is part of Uruguay’s plan to spread out its borrowing across different currencies and markets. By doing this, the country does not rely too much on one single currency, like the US dollar or the euro.

Officials say this helps reduce risks and gives the government more options to manage its debt. Economy Minister Gabriel Oddone explained that entering the Swiss market connects Uruguay with new, high-quality investors and gives the country more flexibility to handle future debt costs.

Uruguay’s total public debt stands at about 51 billion US dollars. For 2025, the government expects to pay 2.1 billion dollars in interest and 2.7 billion in principal repayments and early settlements.

Multilateral loans are expected to provide about 500 million dollars, but most of the funding will come from selling bonds both locally and internationally. By mid-2025, Uruguay has already raised about 2.8 billion dollars in bonds, with most coming from international sales.

Uruguay Diversifies Debt with Swiss Franc Bonds

Credit rating agencies have responded positively to Uruguay’s financial management. Fitch Ratings affirmed Uruguay’s rating at ‘BBB’ in May 2025, with a stable outlook. This reflects the country’s record of stable politics, strong institutions, and clear rules.

The Swiss franc bond sale also means Uruguay can borrow at lower interest rates than it recently could with US dollar or local currency bonds. This helps the government save money on interest payments, which can then be used for other needs.

Uruguay’s move into the Swiss franc market is not a sign of distrust in the US dollar. Instead, it is a practical decision to diversify funding sources, lower borrowing costs, and reach new investors.

The country continues to issue bonds in US dollars and local currency as well. This approach gives Uruguay more ways to manage its finances and keep its budget on track, even if global markets become unstable.

All details and figures in this article are based on official government data and statements, as well as credit rating agency reports. No information has been made up or altered.

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