Argentina's Credit Rating Upgraded by Moody's Amid Fiscal Stabilization Efforts
Moody's Ratings has upgraded Argentina's credit rating, signaling that the government's fiscal stabilization measures have reduced the likelihood of debt defaults.
The ratings agency raised the South American nation's rating one notch to Caa3, the third-lowest speculative-grade level, on par with Ecuador, Bolivia, and Ethiopia. The outlook was also upgraded to positive from stable.
The upgrade reflects Argentina's improving economy, which has strengthened its credit fundamentals over the past year. Moody's credited President Javier Milei's "effective and forceful policy adjustments."
Wall Street has praised Milei's efforts to revive the domestic currency, reduce budget deficits, and control inflation since taking office.
However, Moody's cautions that risks remain as Milei embarks on the "next phase" of his economic overhaul, including the removal of capital and exchange controls.
"New challenges will emerge that could compromise progress made to date," Jaime Reusche of Moody's wrote in a statement.
Argentina's benchmark dollar bonds due in 2035 remained relatively stable on Friday, trading around 67 cents on the dollar.