Bitcoin-Touting Bukele’s Bond Rally Draws JPMorgan, Eaton Vance

El Salvador President Nayib Bukele scared off many on Wall Street by embracing Bitcoin. Two years later, the bond rally he’s overseeing is proving too lucrative to resist.

Eye-popping 70% returns — the best among dollar bonds from emerging markets this year — are attracting investors who were once cautious or avoiding the securities altogether. JPMorgan Chase & Co, Eaton Vance and PGIM Fixed Income are among those who have recommended or bought the debt, betting it will continue climbing.

“Although we missed a significant share of the rally, we still think there’s value across El Salvador’s curve,” JPMorgan research strategists Ben Ramsey, Nishant Poojary and Gorka Lalaguna wrote in a July note, moving overweight on the debt. “There’s room for this credit to keep outperforming.”

The optimism demonstrates how Bukele has gained acceptance from both money managers and his peers in Latin America after many had dismissed him as an anti-establishment maverick. His hard-line stance on gangs, which has dramatically cut crime in the country, is influencing politics throughout the region. And his commitment to paying bondholders is making him a favorite among emerging-market investors.