BBC News, 30
September 2014
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| Argentina is attempting to repay holders of its Par series of debt after defaulting on its Discount bonds |
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Argentina
has deposited $161m (£99m) in bond interest payments with the state-controlled
Nacion Fideicomisos bank, in an effort to skirt US court rulings.
The country
had previously kept its funds with US-controlled Bank of New York Mellon.
The move
comes a day after a US judge ruled Argentina was in "contempt of
court".
That ruling
stated Argentina must repay two US hedge funds before repaying other bond
holders.
"By
making this deposit, Argentina confirms once again its unshakeable commitment
to meet its obligations to bondholders," said Argentina's finance ministry
in a statement.
Argentina
is attempting to pay its bondholders in a second tranche of debt known as the
Par series so as to avoid defaulting once more.
However,
experts caution that simply placing the debt payment in a non-US controlled
bank is probably not sufficient to allow Argentina to avoid a US court ruling
barring it from repaying certain debts above others.
Long fight
Argentina
has been trying to repay the holders of its debt from when the country
defaulted in 2001.
The
majority of those bond holders have agreed to lower payments as a result of
Argentina's bankruptcy.
However,
two hedge funds - NML Capital and Aurelius Capital Management - have demanded
full repayment of the $1.5bn (£920m) they are owed, and have sued to prevent
the country from paying back only its restructured bonds.
After Judge
Thomas Griesa sided with the hedge funds in a July ruling, Argentina was forced
to default on its debt for a second time after refusing to repay the hedge
funds.
Industrial
woes
Argentina's
flagging economy received further bad news on Tuesday, as figures showed
industrial output fell at double the predicted rate in August.
Output
shrank by 2.9% in seasonally adjusted terms, marking the 13th month of
consecutive decline.
Analyst had
forecast a drop of approximately 1.5%.
The fall is
partly due to the weakness of the country's car-making industry.
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