S&P rates Argentina bond B-

Standard & Poor’s said it assigned a B- rating on Argentina’s planned global bond issuance of about $15 billion.

The agency also said it affirmed and changed to “solicited” the B- and B formerly unsolicited local-currency long-term and short-term sovereign credit ratings on Argentina.

S&P also said it will change to “solicited” the country’s long-term foreign-currency sovereign credit rating, which remains at SD (selective default).

The agency also affirmed the transfer and convertibility (T&C) assessment at B-.

The U.S. Court of Appeals recently upheld an earlier lower court ruling that had lifted an injunction that blocked Argentina from paying its foreign-currency debt, the agency said.

The Argentine Congress approved March 31 a new law to repay the holdout debt, which authorized the government to issue new debt to pay holdouts and pave a path to cure that default.

The ratings reflect ongoing challenges to successfully implement difficult measures that address the country’s substantial economic imbalances, including high inflation and a large fiscal deficit, in a context of a still polarized society and an unfavorable external environment, S&P said.

A slow economic recovery is expected for Argentina, the agency added, with GDP expected to contract 0.5% in 2016 and expand about 1.9% in 2017.

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