| SAO PAULO, March 14
SAO PAULO, March 14 The Brazilian government
could push back a potential euro-denominated bond beyond March
if global financial turmoil shows no signs of improvement, two
government sources with direct knowledge of the matter told
Reuters on Friday.
The biggest worry among government officials is about the
escalation of tension between the United States and Russia over
the crisis in Ukraine, which is wrestling with a potential
split, the sources said. Such tension has led to higher
borrowing costs for emerging market governments and companies as
investors flee to the safest investments for protection.
Growing tension between the West and Russia ahead of the
weekend referendum in Crimea pushed down stocks on major world
markets and U.S. Treasury notes higher on Friday and ramped up
the flight into safe-haven gold and the yen.
"We don't have a definitive timetable for the deal. It could
happen by the end of March should a window of opportunity opens.
Otherwise, we will delay it," one of the sources said. Both
sources requested anonymity because they are not allowed to
speak publicly on the matter.
In recent weeks, Brazil's government hired the
investment-banking units of JPMorgan Chase & Co, Banco
Santander SA and Banco do Brasil SA to
organize meetings in Europe with investors, another two sources
said. While the meetings were not specifically held to promote a
deal, government officials were told that a potential 10-year
bond offering in euros would be welcome, some of those attending
the meetings told Reuters.
The government has 800 million euros ($1.1 billion)
outstanding in euro debt securities maturing in Feb. 2015. The
country first issued them in Feb 2005, with a re-tapping taking
place a year later.
Efforts to reach the banks for comment were unsuccessful.