In March, foreign investors continued reducing their participation in Peru Soberanos, reaching 38.7% versus 40.2% in February. This is the lowest since January 2017. In nominal terms, international investors were net sellers of about PEN 1.6bn, mainly in Soberanos 29s (c.PEN 1.17bn) and 28s (c. PEN 467mn), while they added small positions in 34s and 26s. The Soberanos curve performed more or less in line with other LatAm peers, but interestingly, those bonds sold by foreigners experienced the largest yield compression (c.70bp). For the month, Pension Funds and Banks were the main buyers. With most of the political noise left behind, Peruvian local assets are regaining the low-beta status, lower volatility compared to peers. This and PEN strength could further support the Soberanos curve with bonds in the belly of the curve poised to continue their outperformance. The latest CPI print came in a bit higher than expected, but the central bank still has room to keep the key rates steady at the next meeting (11 May), and likely still delay the easing cycle.