MercoPress. South Atlantic News Agency

Argentina began servicing public debt using Central bank reserves

Economy minister Amado Boudou confirmed operations

Argentina began servicing public debt using Central Bank reserves after making its first payment Monday, according to sources from the Economy Ministry.

The Boden 2015 maturity payment totals 204 million dollars, which was dragged from the Debt Reduction Fund. The administration of President Cristina Fernandez de Kirchner is to meet other bond maturities all through April, which will also be cancelled with foreign reserves, amounting to over than 600 million US dollars.

The Central Bank had already allowed the Executive branch the possibility to use the reserves for meeting the public debt payment on March the 1st, when the Head of State signed a second DNU emergency decree and revoked the previous one, creating the Debt Reduction Fund.

However, the reserves had been blocked thanks to an injunction which had banned the Government from using 4,382 billion in foreign reserves.

Last week, Federal Administrative Contentious Courtrooms ruled that the precautionary measures should be lifted, letting the Government make free use of the reserves.

Economy Minister Amado Boudou and Interior Minister Florencio Randazzo confirmed that the debt cancellation was put into motion Monday.

According to Randazzo, “Argentina is going to get out of the default.” The Interior Minister also pointed out during the weekend that the Government will now be focused, after meeting the payments, on cancelling the Paris Club debt.

The Boden 2015 is a dollar-denominated bond which was issued on October 2005 and which pays interests every six months.