Confidence grows among investors following Ecuador’s presidential runoff.

Ecuador’s country risk index dropped sharply on Monday, April 14th, signaling renewed investor confidence following the reelection of President Daniel Noboa in Sunday’s presidential runoff. The indicator fell 562 points in a single day, from 1,844 to 1,282—marking the most significant daily drop in a quarter century, outside of periods when the country declared a moratorium on its debt.

The dramatic shift came after Noboa secured a decisive victory over his opponent, Luisa González, a candidate aligned with former President Rafael Correa and his populist, left-leaning agenda. The outcome appears to have reassured international investors wary of a potential policy reversal or renewed fiscal instability.

“This is the steepest single-day drop since Ecuador adopted the U.S. dollar in January 2000,” said Guillermo Avellán, manager of the Central Bank. “It reflects renewed optimism about the country’s fiscal management and commitment to meeting external obligations.”

Markets betting on fiscal responsibility

The country risk index—compiled by JP Morgan—measures the likelihood that a nation will default on its foreign debt. A high number signals investor concern and typically translates into steeper borrowing costs on international markets. With the index at 1,844 last week, Ecuador would have been forced to pay annual interest rates of around 23% to secure private external financing.

In contrast, loans from multilateral institutions like the IMF or World Bank carried an average interest rate of just 4.76% as of January. The drop to 1,282 points brings Ecuador closer to a more sustainable borrowing range and gives the government additional breathing room as it seeks new funding sources.

Analysts say the post-election decline in the index suggests that global markets are responding positively to what they see as continuity in Ecuador’s economic strategy. President Noboa has made fiscal consolidation a central pillar of his administration, emphasizing both spending cuts and revenue generation in line with commitments made to the International Monetary Fund.

Window opens for multilateral support

Avellán noted that further improvements in the country’s risk profile could be achieved if oil prices remain stable and relations with multilateral organizations deepen. That would not only lower borrowing costs but also improve Ecuador’s access to new loans, a critical lifeline for a nation struggling with limited cash reserves and growing public-sector demands.

A lower country risk index also serves to boost confidence among private investors, potentially spurring capital inflows and improving the outlook for economic growth.

While the sharp post-election decline is an encouraging sign, economists caution that sustaining this momentum will require more than market goodwill. Structural reforms, continued transparency in public spending, and steady progress on the IMF agreement will be necessary to ensure Ecuador stays on a path toward long-term stability.

Nonetheless, with the election now behind him and international markets signaling cautious approval, Noboa appears to have gained a stronger hand in shaping the country’s economic future.