S&P Global Upgrades Argentina's Credit Rating to B-

S&P Global Ratings announced on June 10, 2026, that it has raised Argentina's long- and short-term local and foreign currency sovereign credit ratings to 'B-/B' from 'CCC+/C'. The outlook on the long-term ratings is stable. This upgrade signifies a reduction in Argentina's economic vulnerabilities and a gradual improvement in its external liquidity.

The credit rating increase is primarily driven by the Argentine government's fiscal policies and efforts to reduce economic imbalances. The country has gained better access to liquidity for debt servicing due to continued fiscal surpluses and measures such as lower inflation. The government has secured funding to meet its commercial external debt amortization needs by issuing U.S. dollar-denominated bonds in the local market, obtaining guarantees from official lenders, and entering into repurchase agreements with global banks.

Efforts by the Central Bank of Argentina to accumulate foreign exchange reserves are also noteworthy, with over $10 billion in U.S. dollar purchases during the first five months of 2026. S&P projects a modest current account deficit of -0.2% of GDP for Argentina in 2026, an improvement from -1.1% in 2025. Furthermore, average inflation is expected to decrease to 32% in 2026 from 42% in 2025, further declining to around 9% by 2029. Economic growth is anticipated to be 2.7% in 2026 and approximately 3% in the coming years.

These positive developments indicate that Argentina is taking significant steps towards macroeconomic stability. However, the country has a history of macroeconomic instability, high but declining inflation, exchange rate volatility, and low monetary flexibility. Additionally, weak institutions and significant shifts in economic policy following changes in political leadership have historically hindered the ability of Argentine governments to implement their economic agendas. Despite these challenges, the current government's commitment to fiscal balance as an anchor for its stabilization program and the improved central bank balance sheet support positive expectations.

S&P states that the stable outlook balances the risks posed by persistent economic vulnerabilities with positive fiscal outcomes and other measures that enhance the government's liquidity. The agency expects the government to continue its fiscal austerity program and the central bank to boost its foreign exchange reserves. Analysts suggest that ratings could be further raised within the next 18 to 24 months if external liquidity continues to improve, economic vulnerabilities decrease, and policy certainty strengthens. Nevertheless, the risk of a downgrade remains if progress in stabilizing the economy stalls or if distressed debt exchanges occur.