Argentina’s Country Risk Rises to 1,417 Points; Investors Fear Economic Measures

RIO DE JANEIRO, BRAZIL – Argentina’s country risk reached a maximum of 1,417 basis points on Tuesday, reflecting investors’ fears about the behavior of the domestic economy and doubts about the international situation of the markets, traders told Reuters.

They said that the financial problems faced by Argentina, which is negotiating with the International Monetary Fund (IMF) a new agreement for unpaid debt, are compounded by fears of new confinements in Europe due to the increase in cases of COVID-19.

“The political and economic uncertainty continues to weigh on the country, amid fears of the health crisis and possible decisions that could have implications for the country’s economy and impact on its fiscal deficit. Added to this is the absence of new signs regarding negotiations with the IMF that could take several months,” said Gustavo Ber, director of the consulting firm Estudio Ber.

The markets are also watching to see if the second round of elections for the United States Senate on Tuesday in Georgia will allow the Democrats to win two seats in the Senate and alter what they see as a delicate political balance in Washington. A Democratic victory would mean an additional fiscal stimulus, days before Joe Biden’s presidential inauguration.

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