NEW YORK, March 15 Moody's Investors Service on
Friday cut the credit rating on Argentine sovereign debt
governed by foreign law to Caa1, citing the increased risk of a
default on these issues due to the ongoing U.S. legal case by
holdout investors seeking payment.
Moody's said the move was made to differentiate these bonds
from the rest of Argentina's sovereign debt. It affirmed
Argentina's B3 issuer rating, which applies to bonds issued
under local law.
In addition Moody's affirmed the Ca rating on the $6.3
billion of untendered debt from the 2005 and 2010 debt swaps
that remain in default.
In 2002 Argentina defaulted on its sovereign debt after
years of economic upheaval. A group of investors has held out
from swapping defaulted debt and pursued full payment in U.S.
The outlook on all these ratings is negative, Moody's said
in its statement.