After adding to bond positions in May, foreign investors took a step back and reduced exposure to Peru’s Soberanos bonds in June, foreign holdings stood at 46% compared to 47.3% in May. In nominal terms, the estimated holdings represent about PEN60.9bn and the reduction in monthly position was about PEN1.1bn. Foreigners sold the largest positions in Soberanos 28s (PEN517.4mn), followed by 32s (PEN196.3mn) and, unsurprisingly, international investors were the main sellers in June, while banks and pension funds were the main buyers. The reduction in Soberanos positions by foreigners came in a month when most LatAm currencies and rates retreated, although the PEN and Soberanos fared better than their Andean peers. Weak global market sentiment has kept LatAm assets under pressure, with Peruvian assets no exception, and while investors seem more complacent about local politics, it remains a tail risk.