Argentina's country risk rate falls 578 points, lowest level since August 2018

Argentina’s country risk rating, tracked by JP Morgan, fell Monday to 578 points at the beginning of trading, its lowest level since August 2018.

The fall in the risk rating came amid an improvement for Argentine bonds in the first hours of trading. 

President Javier Milei’s government last week announced a US$1-billion repurchase agreement with five international lenders that will help replenish foreign reserves at its Central Bank.

Domestic bonds have also been stimulated by the certainty of debt repayments and the guarantee that Argentina will also have the necessary funds to meet future obligations.

Next Thursday, Argentina is due to pay US$ 4.3 billion in principal and interest on BONARES and global bonds, both in foreign currency.

In recent days JP Morgan, which oversees the country risk assessment rating, published a favourable report on Argentina, highlighting its chances of economic recovery. It also noted the possibility of a further slowdown in inflation and GDP growth.

“Although Argentina stands out as an outlier in Latin America during 2024 … we still see room for valuations to expand, earnings to recover and country risk to decline, in a context where there are still several catalysts that could materialise in 2025,” wrote the firm.

– TIMES/NA