Sunday , February 28 2021

S & P lowers debt rating in Argentina

A COUPLE – The financial rating agency S & P lowered the bond on Argentine debt from B + on Tuesday due to the B economic crisis, which delayed the implementation of the government's budget correction plan.

The outlook for the note is robust, the agency said in a statement.

"This reduction reflects a decline in growth paths, inflation dynamics and debt trajectories after difficult introducing a demanding economic adjustment program," the agency said.

According to the International Monetary Fund (IMF), Argentina is embedded in a downturn, which should continue in 2019, and the government plans to apply austerity measures in exchange for the support of the fund.

Lee: The Argentine crisis will affect growth prospects for several years

The IMF believes that in 2018 the activity should reach 2.6%.

The August and September monetary crisis accelerated the rise in prices, and since January pesos have lost 50% of the value against the dollar, stimulating inflation.

In exchange for the IMF support program, Buenos Aires promised to reduce the primary deficit to zero (which does not include debt repayment).

"The latest budgetary and monetary developments helped stabilize the financial markets," says S & P.

"But the impact of the unlawful application of the economic strategy has led us to reduce" the note and forecasts of growth and inflation for the next two years, the agency added.

S & P forecasts 2.5% decline in performance this year and 1% next year.

Faced with the economic crisis, the Conservative government of Mauricio Macri asked the IMF for a loan of $ 57,000 million to stabilize the third economy in Latin America.

Source link