World Economy

Puerto Rico Default Nears 100%

Puerto Rico Default  Nears 100%Puerto Rico Default  Nears 100%

The probability of Puerto Rico defaulting on its securities is approaching 100%, Moody’s rating agency said, adding that the more legally vulnerable bonds carry the greatest potential for loss, Reuters reported. Puerto Rico’s Public Finance Corporation on Wednesday failed to transfer $93.7 million to pay the principal and interest on its bonds due on Aug. 1. That puts at immediate risk a payment of $58 million due on Aug. 1, Moody’s said. Without remedial action by either the legislature or commonwealth’s fiscal agent, Puerto Rico will default on this payment, Moody’s said. “The heightened prospects for non-payment of PFC debt service on August 1 are consistent with our view that the probability of default on Puerto Rico’s securities is approaching 100%, and the more legally vulnerable bonds carry the greatest loss potential,” Moody’s wrote.