Argentina bent on default as debt deadline looms: NML

July 20, 2014 - 1:33:58 am

BUENOS AIRES/NEW YORK: A lead holdout investor in Argentina’s debt row said the South American country seemed determined to default, after market gossip of a possible breakthrough sent Argentine bonds higher.

NML Capital Ltd, a unit of Elliott Management Corp suing for full repayment on its bondholdings, said Argentine officials refused to meet or negotiate ahead of a July 30 deadline.

“The Argentine government appears determined to default. We hope it chooses to avoid this dead-end path,” NML said.

If recession-hit Argentina fails to pay out or cut a deal with the New York hedge funds, it faces a default that would prolong its banishment from global capital markets and pile more pressure on an ailing currency.

Argentina says it needs a stay of the US court order that triggered the deadline to reach agreement with the funds, which rejected the terms of huge writedowns after Argentina’s $100bn default in 2002.

Argentine dollar-denominated bonds earlier rallied in over-the-counter trading on market chatter the holdouts were open to a suspension. The holdouts’ lawyers said on June 24 the hedge funds would accommodate the government on timing if talks progressed well. Reuters