Fitch upgrades Argentina’s debt rating to B-

The risk agency Fitch Ratings raised Argentina’s debt rating from “CCC+” to “B-” highlighting reforms and reserve accumulation, but warned about growing inflation. The rating agency underlined improvements in the direction of the economic program led by President Javier Milei and Economy Minister Luis Caputo, stressing the greater solvency in the government’s economic program with regard to repaying its obligations. However, it said some risks remain unresolved. Argentina’s country risk fell 5% and dollar bonds rebounded strongly after Fitch’s reclassification. The new credit score is six notches below investment grade, which indicates low default risk and high security for investors. Currently six Latin American countries hold investment-grade status: Chile, Uruguay, Peru, Panama, Mexico, and Paraguay.  Improvements According to Fitch, the upgrade reflects structurally improved fiscal and external balances, progress in economic reforms, better prospects for foreign currency reserve accumulation and the expectation that the government will secure sufficient financing to meet its debt obligations. In this regard, the agency noted that Argentina’s external position has strengthened, as the country has become a net energy exporter, increasing its resilience to global energy price shocks. Regarding reserves, Fitch pointed out that the government has prioritized the accumulation of foreign currency, with purchases totaling around US$7.1 billion through April and a target of between US$10 billion and US$17 billion for the year. However, it warned that net international reserves remain low when short-term liabilities are taken into account, although they are expected to increase in line with targets agreed with the International Monetary Fund (IMF). Concerns At the same time, the agency stressed that the rating continues to be constrained by Argentina’s weak international liquidity position, high inflation and its history of macroeconomic instability. Fitch also cautioned that debt maturities remain significant, with foreign-currency bond obligations alone reaching nearly US$9.8 billion in 2027. Finally, the report noted that weaker economic activity and lower tax revenues in the first quarter of 2026 pose a more complex outlook for the fiscal situation this year.