S&P joins Fitch, Moody’s in downgrading Argentina amid coronavirus crisis

- Advertisement -
- Advertisement -
- Advertisement -
- Advertisement -

BUENOS AIRES, April 7  – S&P Global Ratings downgraded Argentina on Tuesday, marking the third agency to knock down its sovereign credit rating in less than a week as the coronavirus crisis further complicates the economic outlook of the indebted South American nation.

S&P downgraded Argentina’s long-term foreign currency rating to SD from CCC- after the government said in a decree it plans to postpone until the end of the year payments on up to $10 billion of dollar debt that was issued under local law, in a bid to relieve pressure over looming foreign currency payments.

“This constitutes a default under our distressed exchange criteria,” S&P said in a news release.

“The COVID-19 crisis has exacerbated Argentina’s already stressed fiscal needs and resources, leading the administration of President Alberto Fernandez to reconfigure its financial planning and budgetary priorities,” the agency said, adding that the likelihood of another foreign-currency default is “virtually certain.”

The move by S&P comes after ratings agency Fitch downgraded Argentina’s long-term foreign currency rating to “Restricted Default” from CC on Monday following the government’s decision.

Restricted Default is just a notch above “default” status, while CC represents very high levels of credit risk.

Moody’s Investors Service downgraded Argentina on Friday to CA from CAA2 and changed its outlook to negative, saying it was “likely” holders of Argentina’s sovereign debt would incur “substantial losses.”

Argentina, beset by a persistent economic crisis, is seeking to restructure about $83 billion in foreign currency debt under both international and local law. Delaying payments on local-law debt could give Argentina breathing room and may enable it more easily to pay foreign-law bonds.

The coronavirus outbreak has significantly darkened the economic outlook for Argentina, which has registered 1,628 cases and 54 deaths.

A central bank poll of economists released on Monday showed gross domestic product was estimated to shrink 4.3% this year. The number was down sharply from a 1.2% contraction forecast in the previous month’s poll.

Home of Science
Follow me

- Advertisement -

Discover

Sponsor

Latest

Teva Pharmaceutical Industries Ltd. (TEVA) Gains As Market Dips: What You Should Know

Teva Pharmaceutical Industries Ltd. (TEVA) closed at $9.54 in the latest trading session, marking a +0.85% move from the prior day. The stock outpaced...

The unexpected joy of not knowing when your package will be delivered

Listen, I was as big a fan as any of the free, near-instant online shopping delivery that became the norm over the past several...

Ukraine: Explosions rock Kyiv and Ukraine second city Kharkivon February 27, 2022 at 6:09 am

Reports say missiles hit a gas pipeline and a nine-storey building in Kharkiv, south of the capital.Image source, Getty ImagesFlames lit up the night...

England local elections 2022: What’s at stake for the parties?on March 28, 2022 at 12:04 am

Elections in England this year will reflect voters' views on the cost-of-living crisis, says the BBC's Alex Forsyth.

George Jack Temperley-Wells: Police ‘seriously concerned’ for missing Darlington boyon August 11, 2022 at 8:56 am

George Jack Temperley-Wells is thought to have travelled from Darlington with his mother.Image source, Police handoutPolice in the UK are appealing for urgent help...
Home of Science
Follow me