Argentina's risk premium hits eight‑year low as bonds rally

Argentina's sovereign dollar‑denominated bonds rose on Wall Street, with the Global 2038 and Global 2046 issues gaining up to 0.9%. The country’s risk premium slipped about 2.5% to roughly 425‑437 basis points, the lowest level recorded since April 2018. The move followed Standard & Poor’s upgrade of Argentine debt from CCC+ to B‑, prompting bond prices to jump more than 4% and Argentine ADRs to surge 14%.

Government officials welcomed the development, with Vice‑Minister of Economy José Luis Daza saying that "lending to the country is now cheaper" and suggesting the upgrade could pave the way for Argentina to issue new dollar bonds at acceptable rates. Analysts noted the rating hike removes prudential restrictions that previously kept many foreign investment funds from buying Argentine debt.

Despite the optimism, the rating agency warned of lingering political risks and a looming “wall of maturities” in 2027, when about US$23.8 billion of foreign‑currency debt will come due, half of it owed to multilateral lenders such as the IMF, the IDB and the World Bank. The central bank has been aggressively buying dollars, having acquired over US$11 billion this year, but reserves remain under pressure.