Monday, January 5, 2015
Debt markets have failed to pressure Argentina to end the impasse with holdouts, with the government arguing that it could not offer them new terms without offering similar concessions to holders of restructured debt. With elections scheduled for October, the current government is likely to kick the problem to its successor, leaving Argentina facing continued litigation in US and UK courts.
- The Central Bank has effectively managed drawdowns of dollar reserves, helping the government to maintain its hard line against holdouts.
- While this policy persists, the country will remain locked out of international capital markets.
- The severe shortage of dollars will continue, and will continue to dampen growth prospects until resolved.