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Argentina improved its credit rating according to S&P

The credit-rating agency Standard and Poor´s improved the country’s long-term credit rating from B- to B, with a stable long-term perspective and the short-term sovereign ratings were confirmed at B.

This improvement goes in line with the progress Argentina is making in the resolution of its macroeconomic instabilities and the rebuilding of credibility, within the framework of the foreseeability of its policies and the strengthening of its institutions. In this sense, S&P highlights the importance of INDEC’s reconstruction and the publication of reliable statistics.

The Minister of Finance, Luis Caputo, said: “This improvement reflects the work we have been doing with credit-rating agencies and credit regulators all over the world to show them the speed and the seriousness of the changes that are being implemented in Argentina”. Mr. Minister added: “This rating is a consequence of the work done by the Government to normalize the economy and rebuild credibility and confidence for the rest of the world.”

In addition, S&P increased its Transfer and Convertibility Risk (T&C) to B+ from B-, because there is a “sustained local access to foreign currencies”, according to the official report. Likewise, the agency estimated that inflation will continue with its progressive downward trend and that the economy will recover and grow a 3% in the next 3 years.

Among other indicators, the agency highlights the fact that the National Government has made progress in external liquidity and in the access to trade financing, both for the National Government and for the Provinces and businesses of the country.

In addition, this steady trend includes the agency’s expectations that policies will present a high level of continuity in the next two years. Within that framework, S&P highlights that the increase in the access to credit will play a crucial role as an engine for the recovery of the economy in 2017 and it also highlights the rapid resolution of the dispute with holdouts.