UPDATE 2-Bahrain dinar, bonds rebound after GCC allies promise to avert debt crisis | Reuters

UPDATE 2-Bahrain dinar, bonds rebound after GCC allies promise to avert debt crisis | Reuters:

Bahrain’s dinar recovered from 17-year lows and its bond prices rebounded on Wednesday after the country’s diplomatic allies in the Gulf pledged to prevent its ballooning public debt from triggering a financial crisis.

Bankers said the pledge of aid to Bahrain by Saudi Arabia, the United Arab Emirates and Kuwait eased fears that Manama might be unable to redeem a $750 million Islamic bond that will mature in November.

“It’s time to buy Bahrain,” Barclays said in an analyst report, predicting the aid pledge would ease international investors’ worries about the country’s solvency.