(Adds comments from former central bank, finance officials)
BUENOS AIRES, Aug 23 (Reuters) – Argentina on Friday lost
its appeal of a U.S. judge’s order requiring that it pay $1.33
billion to bondholders who refused to participate in two debt
restructurings after the country’s $100 billion default more
than a decade ago.
Still, the Second U.S. Circuit Court of Appeals put
enforcement of injunctions against Argentina on hold pending
resolution of the country’s appeal to the U.S. Supreme Court,
delaying the specter of a possible default.
The following are analysts’ comments:
RODOLFO ROSSI, ECONOMIST AND FORMER CENTRAL BANK PRESIDENT
OF ARGENTINA
“This was expected. All it does is extend the fight to next
year, although further delay is always taken as a relief. It’s
good news in the short term.”
DANIEL MARX, HEAD OF QUANTUM CONSULTANCY AND FORMER FINANCE
SECRETARY OF ARGENTINA
“Regarding the system of payments, the decision holds that
the action of intermediary banks is protected, although it is
not clear how measures will eventually affect BNY as trustee, as
well as DTC and Euroclear.
“It is important to note the decision clarifies that BNY,
DTC and Euroclear are carrying out functions different from an
intermediary bank.”
JORGE TODESCA, HEAD OF ECONOMIC CONSULTANCY FINSOPORT and
FORMER DEPUTY ECONOMY MINISTER OF ARGENTINA
“Nobody expected a positive decision for Argentina, but this
(is) seen as positive since it buys time. The speculation is
that the Supreme Court won’t take the case.”
KEVIN DALY, FUND MANAGER, ABERDEEN ASSET MANAGEMENT, LONDON
“The good news is that the stay is still in. If the stay had
been removed you would have seen a sharp decline in prices.
“No one knows how long it will take for the Supreme Court to
get to this. We are in August and people expected the court
ruling after the February hearing, so these things take time.
“Surveys suggest global investors are pretty underweight but
locals are buying it.”
STUART CULVERHOUSE, HEAD OF RESEARCH, EXOTIX, LONDON
“The court’s decision against Argentina is what we have been
expecting. Market disappointment may be tempered … by the
continuation of the stay with the Supreme Court appeal. Still,
negative for Argentina bonds, consistent with our view.”
(Reporting by Jorge Otaola, Walter Bianchi, Sujata Rao and
Guido Nemjakis; Writing by Brad Haynes; Editing by Nick
Zieminski)
