Argentina Bonds Are Losing Even After a Record IMF Bailout

Argentina bond investors couldn’t catch a break in 2018, with yields on the country’s debt soaring even after the government took out a record $56 billion credit line with the International Monetary Fund in an effort to bolster public finances, Bloomberg News reported. The average yield on sovereign notes from the country has almost doubled this year to 11 percent, and now tops the 10.9 percent rate on overseas securities from much smaller Ecuador, which has the dubious distinction of having the second-most defaults in the world since 1800. While both credits are considered junk by rating companies, Argentina holds a B grade from S&P Global Ratings, one step higher than Ecuador’s B-. In terms of returns, Argentine creditors lost 23 percent on average this year, according to JPMorgan Chase & Co. indexes, while Ecuador’s investors have lost 9.4 percent. Read more.

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