Moody's downgraded Argentina's rating from Caa2 to Ca last Friday (3), with a negative outlook. The agency says it has completed its review of the Argentinian grade that started on August 30, 2019.

The credit rating agency assesses that private creditors will have to accept "substantial losses" in the current government debt restructuring process, as well as saying that the financial and economic shock of the coronavirus pandemic forces the government to cut its next payments in the following years.

The negative outlook, according to the agency, reflects the risk that investors may experience losses that may be higher than those consistent with the Ca rating, "which typically captures losses of up to 65%". According the agency, the lack of access to markets and the stress on liquidity, aggravated by the pandemic, point to a debt restructuring that will result in substantial losses for investors.