Board: Puerto Rico to be hit with painful austerity measures

The newly appointed head of a federal control board that oversees Puerto Rico's finances is warning the U.S. territory will be hit with painful austerity measures in upcoming months.

Interim Director Ramon Ruiz said Tuesday that there are no other options given the island's critical economic situation. He said that if the local government doesn't submit a fiscal plan by month's end with cuts needed to address a $7 billion deficit, the board will implement its own plan.

Ruiz also said it's unlikely the board will extend a deadline that currently shields Puerto Rico from creditor lawsuits because it would not be fair to bondholders.

His comments come just days after a federal judge ruled that he will hear arguments from bondholder groups opposed to a debt moratorium.