Lawyers said the ruling marked the first time a U.S. judge had issued such an injunction on the so-called pari passu clause of bond contracts, which states that all bondholders must be treated equally. The U.S. government has called Judge Griesas ruling impermissibly broad and said it could undermine U.S. foreign relations. The International Monetary Fund warned that Judge Griesas ruling could make it easier for a handful of creditors to disrupt other debt restructurings. There is a cost to the world, IMF Chief Economist Olivier Blanchard said last week. Analysts say Wednesdays developments will likely rock Argentine markets on Thursday, as the countrys stocks and bonds had rallied this week on hopes that the two sides would reach a deal and avert default. Investors said they had been encouraged by marathon talks on Tuesday and Wednesday between Argentine officials and a court-appointed mediator, as well as a proposal by Argentine banks to pay the holdout creditors.
Posted on: Thu, 31 Jul 2014 18:50:07 +0000
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