Argentina's central bank said on Friday it had sealed a deal for a US$5 billion, one-year loan from international private banks, bolstering its low foreign reserves as the country heads into talks with creditors suing over unpaid debt. Argentina has been shut out of global credit markets because of its long-running legal dispute in U.S. courts with creditors over debt it defaulted on in 2002.
The Argentine government will issue bonds worth US$5 billion to be auctioned this week to pay back debt from imports during the previous Cristina Fernandez administration, according to a resolution published by the current government.
Argentina's central bank approved on Thursday the use of 2.5 billion dollars to pay public debt through the rest of 2013, a move that will further diminish reserves already stretched by heavy state spending ahead of the October midterm election.