US territory misses $58m debt payment

The government of Puerto Rico confirmed on Monday that it failed to make a $58 million debt payment in a significant escalation of the debt crisis facing the US island territory.

Puerto Rico made a partial payment of $628,000 in interest but could not afford to make the remainder, which was due on Saturday, because the legislature did not appropriate the funds, said Melba Acosta Febo, president of the Government Development Bank.

The government had warned on Friday that it would not make the payment and argued that it should not be considered a default under a technical definition of the term, an argument rejected by Moody's Investor Service and others.