Fitch confirms Russia is inevitable to default on its debts
International rating agency Fitch has lowered Russia’s long-term foreign-currency issuer default rating (IDR) from “B” to “C”.
“The C rating reflects Fitch’s view of the inevitability of sovereign default,” TASS said in its report.
The agency explained that the rating action comes after the downgrading of the long-term foreign currency credit rating to “B” with a negative outlook on March 2, and events since then have undermined Russia’s desire to service public debt, according to Fitch Ratings. It should be noted that further tightening of sanctions, which could limit energy trade, increases the likelihood that Russia will selectively default on its sovereign debt obligations.
“To a lesser extent, the risks of introducing technical barriers to debt servicing, including through direct prohibitions of money transfers or through clearing and settlement systems, have increased slightly since our last review,” the agency said in a statement.
The day before, Fitch Group decided to suspend business activities in Russia that cover credit ratings and other services provided through Fitch Ratings and Fitch Solutions.
