Moody's drops Argentina

Moody's Investors Service said it has lowered the rating of Argentina's foreign law bonds to Caa1.

The downgrade reflects the increased default risk of these bonds deriving from ongoing legal proceedings in U.S. courts and differentiates this portion of Argentina's debt from the rest, the agency noted.

As part of its action, Moody's said it affirmed Argentina's B3 issuer rating, which applies to Argentina's domestic legislation bonds and affirmed the Ca rating on Argentina's $6.3 billion of debt untendered in the 2005 and 2010 debt swaps that remains in default.

The outlook is negative.

Moody's said it also affirmed Argentina's B3 foreign currency bond ceiling, Caa1 foreign currency deposit ceiling, and the Ba3 local currency bond and deposit ceilings.

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