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Information > Financial Terms > This page External Bond When a government
borrows money by floating a bond issue in a foreign country, it is said
to float an external loan, and its bonds are external bonds.
The principal and interest of such bonds are issued and payable
in the currency of the country in which the bonds are marketed and have
the advantage of eliminating the risks of exchange fluctuations for the
nationals of the country whose currency is used.
Such loans are to be distinguished from INTERNAL BONDS which the
government sells to investors within the country. |