A Portuguese court approved on Friday a debt restructuring plan that was passed by creditors in major Brazilian telecom firm Oi SA, marking a step forward in the company’s tortured bankruptcy recovery process, Reuters reported. With the court’s approval, seen by Reuters, bankruptcy courts in all relevant jurisdictions - Brazil, the United States, the Netherlands, and now Portugal - have signed off on the recovery plan, which was approved by creditors in December.
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Venezuela’s state-run oil company is preparing to make a $949 million bond payment that’s due Oct. 29, according to a person with direct knowledge of the matter. Petroleos de Venezuela SA’s plan to make the coupon and partial principal repayment on the 2020 notes would mark a rare exception for Nicolas Maduro’s government, which has racked up nearly $7 billion in defaulted debt to investors, Bloomberg News reported. This bond is backed by a majority stake in Citgo Holding Inc., meaning a non-payment would allow bondholders to lay claim to the crown jewel of Venezuela’s U.S. assets.
Odebrecht Engenharia e Construcao SA bondholders are growing more pessimistic about the outlook for the construction conglomerate at the center of Brazil’s epic graft scandal, Bloomberg News reported. The firm’s $1.4 billion of dollar-denominated bonds due in 2025 and 2042 have each lost more than 10 cents over the past month, leaving them at a five-month low near 25 cents on the dollar. Investors are growing concerned the builder is running out of money to pay them back amid a dearth of new projects and a swiftly deteriorating cash supply.
The International Monetary Fund lowered its forecasts for global economic growth this year and next, citing rising trade protectionism and instability in emerging markets, The Wall Street Journal reported. The IMF said the global economy will expand 3.7% this year, down from its April estimate of 3.9%.
The global financial crisis left lasting scars on the world economy, including slower growth, higher government debt and even lower fertility rates, the International Monetary Fund said. A decade after Lehman Brothers filed for bankruptcy in 2008, output in more than 60 percent of the world’s economies remains below where it would have been if the crisis hadn’t occurred, the fund said in a report Wednesday. The drop was steepest in the 24 countries that experienced financial crises, the Fund said in an analytical chapter accompanying its latest World Economic Outlook, Bloomberg News reported.
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The sell-off in the Argentine peso intensified on Friday, with the currency once again approaching record lows following another big drop at the market open, the Financial Times reported. The peso tumbled 4.7 per cent to hit 41.15 per dollar, knocking out its previous closing low of 39.79 and putting it just a hair away from the all time intraday low of 41.36 reached on August 30. The sharp drop follows Thursday’s 2.8 per cent decline and comes despite the IMF agreeing on Wednesday to increase its bailout package to the Latin American country by an extra $7.1bn.
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Embraer SA will have the right to block ten crucial matters in the commercial-aircraft joint venture it’s forming with Boeing Co, according to a Memorandum of Understanding between the two companies, Bloomberg News reported. The document was made available via the website of the Sao Jose dos Campos Metalworkers Union on Sept. 21 after the Labor Prosecutor’s Office requested a copy of the MoU under judicial confidentiality and made it public…Embraer’s American Depositary Receipts reversed earlier gains after the MoU was reported and were trading down 0.3 percent to $19.72 at 2:08 p.m.
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Ecuador’s fiscal discipline is making investors forget about its history of defaults, according to Finance Minister Richard Martinez. The 38-year-old economy chief said his emphasis on budget cuts, transparency and communication since taking office in May is luring foreign fund managers to the nation with the dubious distinction of having the second-most defaults in the world since 1800, Bloomberg News reported. Ecuador’s yield spread over U.S. Treasuries has fallen to 620 basis points, briefly dropping below Argentina for the first time since 2015.
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Argentina won a promise of extra cash and faster delivery from the International Monetary Fund, which expanded a record bailout to help the country defend its currency and pull the economy out of recession, Bloomberg News reported. Argentina’s credit line will increase to about $57 billion over three years, from the $50 billion announced in June. The Fund will also deliver more of that cash up front. Argentina has already received $15 billion and will have access to another $35 billion by the end of 2019.
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Argentine Central Bank President Luis Caputo resigned on Tuesday, a day after President Mauricio Macri said a revised aid deal with the International Monetary Fund would require a new approach to monetary policy, Bloomberg News reported. Just three months since moving to the central bank from the nation’s finance ministry, Caputo cited "personal issues" as the reason for his departure. He was immediately replaced by Economy Minister Nicolas Dujovne’s deputy, Guido Sandleris.
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