Russia has temporarily avoided default on its sovereign debt by paying interest on s
Global rating agency Standard & Poor’s downgraded Russia’s debt default risk rating to “CC” from “CCC-“, Reuters reported, while saying Russia was struggling to repay dollar-denominated Eurobonds in 2023 and 2043. The Russian Finance Ministry said it had paid $117 million in interest on sovereign bonds due. The agent payee is Citibank in London. Citi declined to comment. The report said that some creditors have received Russian dollars to pay interest on debt due this week, avoiding its first sovereign debt default since 1998.
However, S&P believes that the European bond interest that Russia has to pay in the coming months may face difficulties due to international sanctions that reduce Russia’s available foreign exchange reserves.
Kremlin spokesman Dmitry Peskov stressed that Russia has the necessary funds and that any default on its debts is entirely man-made.