01835cas a2200265 a 4500 AALejournalIMF005466 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451871173 1018-5941 BD-DhAAL BD-DhAAL Gupta, Sanjeev. Is it (Still) Mostly Fiscal? : Determinants of Sovereign Spreads in Emerging Markets / Sanjeev Gupta, Amine Mati, Emanuele Baldacci. Washington, D.C. : International Monetary Fund, 2008. 1 online resource (23 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Using a panel of 30 emerging market economies from 1997 to 2007, this paper investigates the determinants of country risk premiums as measured by sovereign bond spreads. Unlike previous studies, the results indicate that both fiscal and political factors matter for credit risk in emerging markets. Lower levels of political risk are associated with tighter spreads, while efforts at fiscal consolidation narrow credit spreads, especially in countries that experienced prior defaults. The composition of fiscal policy matters: spending on public investment contributes to lower spreads as long as the fiscal position remains sustainable and the fiscal deficit does not worsen. Mode of access: Internet Baldacci, Emanuele. Mati, Amine. IMF Working Papers; Working Paper ; No. 2008/259 Full text available on IMF http://elibrary.imf.org/view/journals/001/2008/259/001.2008.issue-259-en.xml IMF e-Library