Wow! Argentina pays up.

In what I think can be fairly described as a surprise move, the Fernandez government announced that it will use foreign reserves held by the Central Bank (of which Argentina has around $47 billion) to pay off its $6.7 billion debt to the Paris Club countries, which has been in default since 2002.

"I have signed a decree today instructing the economy minister to use available central bank reserves to pay off the Paris Club debt," Fernandez said in a live televised speech, met with a standing ovation from industrial-sector executives.

This is the same method that Fernandez's husband, the ex-president Kirchner used to pay off Argentina's debt to the IMF a couple years ago.

Argentina is in the strange position of still belonging to the IMF but refusing to undergo the annual IMF reviews that generally are done for all members whether they are in a loan program or not.