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Ratings agency: Argentina in 'selective default'

Wednesday - 7/30/2014, 5:28pm  ET

In this Friday, July 25, 2014 photo, a man sleeps on a street in Buenos Aires, Argentina. As the clock ticks down to a July 30th deadline to reach a deal with creditors over unpaid debts, Argentines are bracing for what is likely to be the country’s 8th time to default in its history. (AP Photo/Natacha Pisarenko)

NEW YORK (AP) -- Standard & Poor's says some Argentine bonds are in 'selective default' in what could be the start of a wave of downgrades amid a standoff between the South American country and some creditors.

The ratings agency says it lowered its rating on some Argentine bonds because the country did not make a $539 million interest payment due on June 30.

Argentina tried to make the payment but was prevented by a New York judge as part of an effort to force the country to settle a dispute with U.S. creditors.

S&P said Wednesday it could revise the rating if Argentina were to make the interest payments.

The downgrade came as the economy minister led a last-gasp effort to strike a deal with hedge funds demanding payments of about $1.5 billion.

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