Argentina Country Risk Falls to 506 as Bad Debts Climb
Argentina country risk fell to 506 basis points on Friday, even as bad debts climb. Supermarket sales are down and arrears hit 17.5% of individual credit. The post Argentina Country Risk Falls to 506 as Bad Debts Climb appeared first on The Rio Times .
Argentina's country risk dropped to 506 basis points on Friday, August 21, 2026, even as bad debts climbed, according to the JP Morgan indicator. This marked a decline from 535 the previous day, which had been the three-month high. A basis point represents one hundredth of a percentage point, so 506 basis points implies investors demand an additional 5.06 percentage points of yield for holding Argentine debt compared to US government debt.
Despite this improvement in country risk, Argentine households face challenges. Arrears reached 17.5% of the credit portfolio to individuals in June 2026, as reported by a Universidad Austral and Eco Go study using central bank data. Arrears refer to loans where borrowers have fallen behind on payments, encompassing both bank and non-bank lending, measured as a share of total credit to individuals.
Furthermore, supermarket sales at constant prices decreased by 3.1% year-on-year in June 2026, according to INDEC, the statistics agency. Additionally, supermarket sales have declined by 2.8% so far in 2026. President Milei spoke to business leaders at the 142nd anniversary of the Rosario stock exchange on Friday, stating that there are no grounds to blame government policy for the current arrears situation.
Security Minister Patricia Bullrich also commented on the challenges some sectors are facing, emphasizing that the government is aware of these difficulties.
While the drop in country risk may indicate slightly increased investor confidence in Argentine debt, the rising arrears and falling supermarket sales suggest that ordinary people are struggling. Overall, the overall picture remains mixed, with the high arrears rate signaling that many Argentines are behind on their loan payments.
In contrast, the Merval index, the main share index of the Buenos Aires exchange, rose by 1.3%, reflecting optimism among stock investors. However, the arrears data paints a different picture of the real economy, with households cutting back on spending due to weaker consumer demand.
Written by urgent.news from The Rio Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
