The capital markets have not been friendly to Brazilian issuers over the past year, least of all to the sovereign, which at one point was trading at a spread of more than 2,400 basis points over US treasury bonds. Traders had decided that a victory by leftist presidential candidate Luis Inacio Lula da Silva (Lula) would be tantamount to default. After Lula won and appointed a solid economic team, however, spreads started tightening dramatically, and soon it became clear that the market was, in fact, open for the right issuer at the right price.
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