LONDON: Pakistan’s international bonds dropped more than 1 cent on Wednesday after Lahore said it has “credible intelligence” that India intends to launch military action soon as tensions escalate between the nuclear-armed neighbours.

The 2036 bond suffered the biggest decline, falling 1.3 cents to be bid at 71.85 cents in the dollar, Tradeweb data showed, though bid-ask spreads of around 1 cent pointed to limited liquidity.

Relations between the two countries have been fraying since an April 22 attack on tourists in Indian Kashmir that killed 26 people.—Reuters