NEW YORK, April 5 (Reuters) - Argentina's "country risk" measure dropped on Friday, with investor demand for premium to hold Argentine foreign dollar bonds hitting its tightest since September 2020.
Argentine bond prices rose sharply, with the 2030 up more than 4 cents to trade at 56.15 cents on the dollar, its highest since the restructure bonds were issued in late 2020. Yields fall as bond prices rise.
The 2029 note also touched a historic high.
Investors have bet that the administration of right-wing libertarian President Javier Milei, in power since December, will succeed in transforming the Argentine economy.
"A fiscal surplus was recorded in January and February for the first time in over a decade, international reserves are being rebuilt, inflation is falling more quickly than anticipated," Julie Kozack, spokesperson for the International Monetary Fund, said on Thursday, noting that the progress has been "impressive."
The spread in JPMorgan's EMBI Global Diversified Argentina index, a so-called measure of country risk, tightened to 1,304 basis points and was on track to end the session at its most narrow since September 2020.
Spreads were also affected by a spike in U.S. yields after strong labor market data dampened bets on anticipated Federal Reserve interest rate cuts. The yield on the U.S. 10-year note was on track to close at its highest of the year.
(Reporting by Rodrigo Campos; Editing by Paul Simao)
