Ratings agency: Argentina in 'selective default'

By the Associated Press | July 30, 2014 | 5:36 PM EDT

Axel Kicillof, Argentina's economy minister, arrives amid a crowd of reporters for negotiations, Wednesday July 30, 2014, in New York. Argentina officials and U.S. bondholders met for the first time in hopes of preventing an Argentine default. (AP Photo/Bebeto Matthews)

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.