What is sovereign debt?
Sovereign debt is a bond issued by a national government in a foreign currency, in order to finance that country's growth. Sovereign debt is generally consider a riskier investment when it is issued by a developing country. When issued by a developed county it is generally considered a safe investment. The stability of the issuing government is an important factor when assessing the risk of investing in sovereign debt, and sovereign credit ratings help investors weigh this risk.
Updated on Monday, February 06 2012 at 06:46PM GMT
Source:
www.investopedia.com/...
Collections:
national government,
investor,
stability,
currency,
risk
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