Argentine economy minister Kicillof says country not in default

BUENOS AIRES, July 31 Thu Jul 31, 2014 4:39pm EDT

BUENOS AIRES, July 31 (Reuters) - Argentine economy minister Axel Kicillof said on Thursday that the country was not in default and threatened court action if any bondholders demanded their money back.

Latin America's No.3 economy failed to clinch a deal in last-minute talks with holdout creditors, leaving it unable to comply with debt payments that fell due on July 30.

But most market participants expect the government or third parties to reach a deal with the holdout creditors eventually. The government would not oppose an agreement between private parties, Kicillof said.

A determination that a credit event had occurred would trigger a series of insurance payments to creditors and would give most of Argentina's current bondholders the right to demand their money back. (Reporting by Buenos Aires bureau; Editing by James Dalgleish)

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