Credit ratings agency S&P Global upgraded Argentina's sovereign credit rating to ‘B-’ on Wednesday, citing "reduced economic vulnerabilities and a gradual improvement in external liquidity."
The move brings S&P into line with Fitch Ratings, which in May also raised Argentina's rating from ‘CCC+’ to ‘B-.’
In a report, S&P said the reforms implemented by President Javier Milei had “set the stage for continued economic recovery.”
It said it had raised both its short- and long-term local and foreign currency ratings from 'CCC+/C' to 'B-/B.’
The agency attributed the upgrade to the country's sustained fiscal surplus, lower inflation and improved government access to financing.
Economy Minister Luis Caputo welcomed the decision in a post on social media, describing it as a "new upgrade" for Argentina's credit ratings.
S&P said its stable outlook reflects expectations that the government will maintain its fiscal austerity programme, with the Central Bank continuing to rebuild foreign currency reserves. Together, those factors are expected to support economic growth and further disinflation.
“The upgrade reflects easing economic vulnerabilities and gradually improving external liquidity that set the stage for continued economic recovery. Fiscal austerity, along with other measures, has improved the government’s access to voluntary funding from capital markets, as well as official lenders, to meet substantial foreign currency commercial debt servicing needs in 2026 and 2027,” read a report announcing the rating.
For 2026, S&P forecasts economic growth of 2.7 percent and inflation of 32 percent, broadly in line with the current annual rate of 32.4 percent and far below the 117.8 percent recorded in 2024.
According to the latest available data published by the INDEC national statistics bureau, Argentina's economy expanded by 5.5 percent year-on-year in March.
Despite the upgrade, S&P warned that external debt levels and continued market volatility remain significant sources of risk.
The agency also pointed to Argentina's long history of macroeconomic instability and abrupt policy shifts, which it said have undermined the credibility and predictability of the country's institutions.
However, it added that the Milei administration had succeeded in passing a number of reforms that could support growth and encourage greater formalisation of economic activity.
Since taking office in December 2023, Milei has pursued a programme of deep spending cuts that allowed his administration to close its first two years in government with a fiscal surplus.
An improved sovereign rating can reduce perceptions of risk among investors and strengthen the government’s chances of returning to international capital markets to refinance debt.
– TIMES/AFP/NA
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