S&P Global Ratings released a downgrade to “selective default” late Friday after Russia paid foreign bonds in rubles on Monday when they were paid in dollars. He said he did not expect Russia to be able to convert the ruble to the dollar within the allowed 30-day grace period.
The S&P statement said its decision was partly based on its view that sanctions against Russia for its actions Invasion of Ukraine “It is likely to increase even more in the coming weeks, which will hinder the will and ability “Russia’s strategies to fulfill its obligations to foreign debtors”.
An S&P spokesman said a selective default rating occurs when a lender violates a particular payment but makes another on time.
While Russia has shown that it is still willing to pay its debts, the Kremlin has also warned that it will do so in rubles if its foreign accounts remain frozen in foreign currency.
Sanctions against Russia tightened this week Evidence of alleged war crimes – Killing of civilians in the city of Bucha during Russia’s military occupation – he banned from using foreign reserves of US banks to pay off debts.
The Russian finance ministry said on Wednesday that it had attempted to pay $ 649 million for two bonds to an unnamed U.S. bank – previously reported by JPMorgan Chase – but heavier penalties prevented it from receiving payment, so it paid of rubles.
It has Western sanctions It has hit the Russian economy hard And the S&P and other rating agencies have already reduced their debt to the “useless” state, which it considers likely a default.
The country did not suffer from foreign debt after the Bolshevik Revolution of 1917, when the Soviet Union emerged. In the late 1990s, after the collapse of the Soviet Union, Russia was able to resume repaying foreign debts with the help of international aid. However, he ended up in home debt.
Source: Huffpost
