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Emerging markets in decline, but El Salvador bonds shine, Bitcoin President Nayib elated

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Emerging markets in decline, but El Salvador bonds shine, Bitcoin President Nayib elated

The economic weakness in China has impacted emerging markets, but Bitcoin-backed bonds in El Salvador, governed by President Nayib Bukele, have been the best performers among emerging markets. President Nayib Bukele in El Salvador must be pleased with this news.

China's Weak Economic Data Causes Turbulence in Emerging Markets

With weak economic data from China, emerging market currencies and stocks are impacted. MSCI Inc.'s Emerging Markets Currency Index fell by 0.5%, marking the largest drop in nearly a month, with multiple currencies sliding alongside the Renminbi. The Emerging Markets Stock Index dropped by 1%, ending a two-day rally, still some distance away from the largest decline since August 25.

A private survey on China's service sector showed the slowest expansion in activities for the year in August, dampening sentiment due to additional stimulus measures by the government for the real estate market. This weak data also overshadowed China's developer Evergrande Group making interest payments on two USD bonds within the grace period, avoiding a default for the first time.

El Salvador Receives Support for Debt Restructuring

In the bond market, El Salvador's USD bonds performed well, with those maturing in 2029 rising by 1.8 cents to 80 cents. The government accepted a proposal from banks to swap short-term bonds for new bonds with maturities of up to seven years. Additionally, Ecuador's Euro bonds also performed strongly, rising by 1.2 cents to 50 cents since the presidential candidate Daniel Noboa led in the first round of elections two weeks ago.

El Salvador's President Nayib Bukele Proud of Bitcoin

El Salvador's President Nayib Bukele, whose Bitcoin policy has faced scrutiny, expressed satisfaction as Bloomberg reported positively on El Salvador, stating, "I wouldn't say 'I told you so'."

Recap: "Bitcoin Didn't Ruin a Country" - El Salvador President Pays Off $800 Million Bond, Questions Why Media Isn't Reporting