Puerto Rico

In Fitch Ratings' opinion, Puerto Rico's reported decision to miss an August 1 debt service payment on appropriation-backed debt (not rated by Fitch) due Monday, Aug. 3, is consistent with both the commonwealth's stated intent to restructure its debt and its current liquidity pressures.

Puerto Rico’s government has suspended setting aside money for its general obligation debt, increasing concern among some investors that even the island’s government-guaranteed debt may not be paid.

Puerto Rico’s economic activity index was down 0.3% in June from May.

Puerto Rico Public Finance Corp. may miss a $58 million bond payment due Monday, in what could be the first volley in the biggest municipal default in history.

Popular Inc. is planning to sell its $75 million Puerto Rico Electric Power Authority line of credit at a 40% discount.

Treasury Secretary Jack Lew’s recommendation Tuesday to grant Puerto Rico municipalities and public entities access to Chapter 9 bankruptcy protection failed to convince Sen. Orrin Hatch, R-Utah, that the administration has the clear plan that’s needed before Congress can act to help the territory.

Puerto Rico Electric Power Authority moved a step closer Tuesday to cutting costs through the use of natural gas rather than oil for electricity production, as a Federal regulator authorized marine terminal off of Aguirre.

Leaders and politicians of Puerto Rican descent on Tuesday called on President Obama to help negotiate a fair debt deal with the island’s creditors and explore a Federal Reserve loan.

Puerto Rico wound up with a $703 million deficit in 2015, a fiscal year it had budgeted to be at least superficially balanced, according to Puerto Rico Secretary of the Treasury Juan Zaragoza Gómez.

A source close to the Puerto Rico government, disputing a report that restructuring is avoidable, said specific debt decisions will be delayed until at least least mid-September.

Puerto Rico Electric Power Authority’s proposed partial moratorium on debt payments may foreshadow the commonwealth’s strategy for restructuring the island’s estimated $72 billion of debt.

The Puerto Rico Electric Power Authority has five weeks to bridge remaining differences with its forbearing bondholders over how to deal with its $8.1 billion of bond debt.

The probability of a Puerto Rico default that would cause “substantial” losses “is approaching 100%,” Moody’s Investors Service said.

Municipal bond funds have reported outflows for 11 straight weeks, as investor confidence gave way to concerns over the credit of such issuers such as Puerto Rico and Chicago and the probability of rising interest rates.

The Puerto Rico Electric Power Authority board of directors announced Tuesday it named Javier Quintana Mendez the authority’s new executive director.

The Senate Finance Committee on Tuesday approved a bipartisan, modified, two-year tax extenders bill that includes several provisions relating to bonds and Puerto Rico.

Puerto Rico’s total employment declined by 0.7% in June from May on a seasonally adjusted basis.

Municipal Market Analytics professionals Monday said it was “quite reasonable” to expect that the Puerto Rico Public Finance Corp. will make its debt service payments on Aug. 1.

Standard & Poor's Ratings Services said it has lowered its CCC-minus rating on Puerto Rico Public Finance Corp. (PFC) series 2011A and B and series 2012 A bonds to CC following non-appropriation of debt service by the legislature in the fiscal 2016 budget.

Puerto Rico's longstanding and deepening fiscal challenges led most closed-end municipal bond funds (CEF) to reduce holdings of the debt of the commonwealth, protecting the majority of these funds from substantial negative effects, says Fitch Ratings.