Argentina’s surprise decision to pay off its defaulted $6.7bn debt to the Paris Club of western creditors with central bank funds is a welcome step towards ending its international financial isolation, but does nothing to bring it closer to a return to global capital markets.

The timing of Tuesday’s announcement appeared intended to allay fears sweeping Wall Street in recent weeks that with limited credit options, slowing growth, opaque policies on inflation and revenue for its key agricultural exports squeezed by falling commodities prices, Argentina was heading for another default.