On Aug. 11, 2008, Standard&Poor's Ratings Services lowered its foreign and local currency long-term credit ratings on the Republic of Argentina to 'B' from 'B+'. At the same time, Standard&Poor's affirmed its 'B' short-term foreign and local currency sovereign credit ratings on Argentina. In addition, Standard&Poor's lowered its national scale rating on Argentina to 'raAA-' from 'raAA'. The outlook is stable. Standard&Poor's also lowered its transfer and convertibility assessment on Argentina to 'BB-' from 'BB', and the '4' recovery rating on the republic's bond issues is unchanged. The downgrade reflects Argentina's increasing economic challenges. In particular, inflation and fiscal and financial strain have increased while the likelihood of the government taking prompt
