Research Update: Argentina Downgraded To 'SD' On Short-Term Debt Maturity Extension; Long-Term Issue Ratings Lowered To 'CC' From 'CCC-'

The administration of President Alberto Fernandez announced on Dec. 19, 2019, a unilateral extension (until August 2020) of U.S. dollar-denominated short-term paper (Letes) held by private-sector market participants. This constitutes default under our criteria, and we are lowering the foreign currency long-term sovereign credit rating on Argentina to 'SD' from 'CCC-' and the short-term rating to 'D' from 'C'. We are also lowering the local currency long-term sovereign credit rating to 'CC' from 'CCC-', given the heightened prospects for restructuring all long-term debt soon. We also affirmed the local currency short-term sovereign credit rating at 'C'. Uncertainty about the government's broader strategy and its intention to make timely payment on peso-denominated debt due in the coming weeks will inform when

...- The administration of President Alberto Fernandez announced on Dec. 19, 2019, a unilateral extension (until August 2020) of U.S. dollar-denominated short-term paper (Letes) held by private-sector market participants. - This constitutes default under our criteria, and we are lowering the foreign currency long-term sovereign credit rating on Argentina to '##' from '###-' and the short-term rating to 'D' from 'C'. - We are also lowering the local currency long-term sovereign credit rating to '##' from '###-', given the heightened prospects for restructuring all long-term debt soon. We also affirmed the local currency short-term sovereign credit rating at 'C'. - Uncertainty about the government's broader strategy and its intention to make timely payment on peso-denominated debt due in the coming weeks will inform when we could raise the sovereign credit rating from '##'....

Research Update