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Friday 01.07.2016 | Name days: Rimants, Imants, Ingars, Intars

Argentina defaults on debt for second time in 12 years

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUArgentina for the second time in the last 12 years is unable to pay its dept. The situation might deepen the recession of Latin America’s third largest economy and fuel its inflation.

After a long legal battle with U.S. hedge funds that rejected Argentina’s debt restructuring following its 2002 default, Argentina failed to reach a deal in time to meet a deadline for a coupon payment on exchange bonds.

In June 2013, a U.S. Supreme Court judge ruled that Argentina was liable to pay the investment funds the 967 million euros they were demanding and blocked payments to the restructured bond holders unless it also paid this sum.

Reuters evaluates that even a short default will raise Argentinean companies’ borrowing costs, increase pressure on the peso, drain foreign reserves and fuel one of the world’s highest inflation rates. Inflation in Argentina in June was at 21.5%.

The consequences of this second default may be a worsening of an economy already in recession and a weakening currency as more Argentines seek to hold dollars.

Ref: 111.111.111.1370


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  1. mike walsh says:

    Deliberately so I hasten to add. What the government of Argentina has done is follow the example of other nations caught up in the never-ending cycle of Wall Street usury. They have told Wall Street to go and jump for their money. Well done, Argentina.

    Iceland President Ólafur Ragnar Grímsson says, the government (Iceland) bailed out the people and imprisoned the bankers, the opposite of what America and the rest of Europe did.”

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    • Linda says:

      Quite. We should all stop investing in each other’s countries and keep our monies within our own borders. I wonder what the foreign influx would do. I’d charge tax on movement of monies out of own country borders.

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      • Foreigner says:

        Yes, a brilliant idea to keep money in its own country. I thought you were happy that Soviet had gone?

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