Rise in political risk will have minor effect on Bulgarian Eurobonds - RBI

Rise in political risk will have minor effect on Bulgarian Eurobonds - RBI Author: Ken Teegardin. Licence: Creative Commons.

SOFIA (Bulgaria), November 14 (SeeNews) – Rise in political risk following the Bulgarian presidential elections and the resignation of the cabinet will not justify a strong reaction for Bulgarian Eurobonds, Vienna-based Raiffeisen Bank International (RBI) said on Monday.

“The rise in political risk is definitely not supportive for the country risk assessment. However, we do not expect a strong reaction for Bulgarian Eurobonds for the time being as the fiscal situation remains solid, while economic momentum has surprised on the upside recently,” RBI said in a daily CEE outlook report.

There is also a good chance that voter behaviour in the forthcoming early parliamentary elections will follow different patterns and that the drive for new elections was just a gamble of Bulgarian prime minister Boyko Borissov in order to secure another mandate, RBI said.

Despite that, RBI added, careful monitoring of the political sentiment is needed in the following months as narrow polls would definitely indicate a risk that Borissov's governing party has misread the situation.

Delivering on his pledge to resign if the candidate of governing centre-right GERB party loses the presidential elections, party leader and prime minister Borissov submitted to parliament the resignation of the minority coalition cabinet composed of GERB and their junior coalition partner, right-wing Reformist Bloc.

GERB's candidate in the presidential elections, parliament speaker Tsetska Tsacheva, lost Sunday's run-off vote to Rumen Radev, a former Air Force commander seen as friendly to Moscow who was backed by main opposition Socialists.

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