Argentine bonds rose strongly on Tuesday on optimism that a restructuring deal being brokered with creditors could be in reach, even as rating agencies slapped the country with downgrades after it defaulted for the ninth time last week.
Argentina technically defaulted on Friday for the second time this century after failing to pay US$505 million of interest on its bond debt, but it continues to negotiate a restructuring with creditors. We're not paying but the negotiations are continuing, a government official said.
The Argentine Ministry of Economy extended until June 2 the term to renegotiate the US$ 67 billion of debt securities issued under foreign law, with the aim of continuing negotiations with creditors.
The International Monetary Fund expressed optimism that Argentina can reach an agreement with private creditors “to establish a sustainable path in the future” when the government of President Alberto Fernandez formally extended the deadline term to reach an understanding on the US$ 67 billion debt.
Argentina will extend negotiations over a US$ 65bn debt restructuring proposal until May 22, the government said in the official gazette on Monday. The extension sets the stage for tense last-ditch talks as Argentina races to avoid default.
Argentina said it didn’t make US$ 500 million in debt payments due Wednesday, starting a 30-day countdown to a possible default unless the government and bondholders can reach a deal on restructuring its massive foreign debt.
The coronavirus outbreak in Ecuador is increasing pressure on President Lenin Moreno to default on US$ 17 billion in debt and devote more resources toward fighting a pandemic that has left bodies in the streets of the nation’s largest city.
Argentina's Economy Minister Martin Guzman iis in New York and on Monday will be participating of a conference at the Council of Americas. Later in the day he will meet h International Monetary Fund and U.S. Treasury officials, as part of Argentina's efforts to revive growth and renegotiate its debts.
Buenos Aires province bonds added to recent losses on Tuesday after the provincial government asked holders for an extension on a more than US$ 250 million payment due later this month, dragging Argentina’s debt lower as well.
Argentina's new government announced the issuance of US$ 1.326 billion of dollar-denominated Treasury Bills, to be directly subscribed by the central bank, according to a decree in the Official Gazette on Thursday.