Ecuador expected to make debt payments on social security soon, says GS

Reports are circulating that Ecuador is due to reach an agreement with the social security institute (IESS) over settling an old debt worth about $5 billion, say analysts at Goldman in a research report sent out last night. The debt has been a source of conflict in the past, the analysts say. The debt repayment would follow Ecuador's renewed stance on paying its debts after its tough talk back in January of 2007 that it might default on payments of $10.4 billion worth of foreign debt.

Moody's recently upgraded Ecuador's ratings due to the swelling price of oil. Despite some positive sentiment towards Latin America lately, CDS in benchmark regional names is still historically wide. Venezuela routinely was at 650bp last week and even higher earlier in March. It started the year in the low 450bp range. Argentina's CDS is at 560bp.