Chile Pays Price for Timing, Size of CPI-Linked Bond Sale Abroad

Chile’s government surprised investors with simultaneous bond sales abroad and on the local market last week, at a time when global yields were soaring. Analysts said it paid a price for its “poor” timing and ambition, and fueled a decline in existing bonds.

The Treasury issued $176 million in inflation-linked notes due in 2050 and $111 million in peso bonds also due in 2050 on Oct. 18, as was scheduled. It then caught the market off guard with a sale of $929 million in sustainability-linked bonds due in 2039 to local and foreign investors on the same day.

“The timing ...