NEW YORK/CARACAS (Reuters) - Venezuela faces payments of $1.1 billion in interest and principal on two bonds maturing on Wednesday, but investors expect the cash-strapped nation to continue its pattern of no payments.

Venezuela's President Nicolas Maduro holds a bank note of the new Venezuela's currency Bolivar Soberano (Sovereign Bolivar) as he speaks during a meeting with ministers at Miraflores Palace in Caracas, Venezuela July 25, 2018. Miraflores Palace/Handout via REUTERS

The government of President Nicolas Maduro has halted almost all foreign debt payments, leaving Venezuela, which has a debt load of around $60 billion in direct and subsidiary foreign bonds, in default.

“We assume no funds allocated to make the sovereign amortization today as the first sovereign default and headline confirmation of cash flow stress,” Siobhan Morden, head of Latin America fixed income strategy at Nomura Securities International, wrote in a note to clients.

“It still looks like a countdown with economic crisis morphing into political crisis for the Maduro administration.”

Maduro’s government began quietly halting debt interest payments last year in an effort to save hard currency for the collapsing economy, which is suffering from hyperinflation.

Failure to make payments on Wednesday would mark Venezuela’s first sovereign default since Maduro announced in November a plan to restructure the country’s debt.

Venezuela’s Information Ministry did not immediately respond to a request for comment.

CAN’T GET MUCH WORSE

The maturing bonds are a fixed-coupon issued in 1998 with $752 million in principal and $51.2 million in interest VENGLB18=RR, and one issued in 2001 with $300 million in principal and $20.4 million in interest VE013635706=.

The two bonds maturing on Wednesday traded at 28 cents on the dollar earlier this week, according to Reuters data.

“Prices are so on the floor right now that you could see a huge recovery,” said Ray Zucaro, chief investment officer at RVX Asset Management in Miami.

Zucaro, who said he has a small exposure to a bond from Venezuelan state oil company PDVSA, does not expect Caracas to pay Wednesday’s maturing bonds.

“The news flow is so negative I don’t know how much worse it can get,” he said. “I think we’re closer to a (breaking) point than we’ve ever been, but does that mean Maduro is gonna go in six months, six weeks, six days or six years? That’s hard to say.”

Venezuela’s benchmark 2027 U.S. dollar-denominated sovereign bond VE008013667= was last bid at 26.625 cents on the dollar.