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Moody’s confirms Russia’s default on external debt

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Moody's confirms Russia's default on external debt

Moody’s confirms Russia’s default on external debt

Ukrinform

International rating agency Moody’s confirmed on Monday that Russia has entered into default on its external debt due to the inability to make interest payments caused by Western sanctions after its invasion of Ukraine.

This was reported by Ukrinform with reference to Forbes.

Russia’s missed June 27 payment “represents a default” and such defaults “are likely to continue.”

Reuters, citing its own sources, said earlier that some Taiwanese Russian bondholders did not receive interest payments even after the deadline (Sunday), indicating a default.

the Russian government cited economic sanctions preventing it from making payments despite having the resources.

Read also: Yermak on Russia’s default: sanctions should be applied against the entire banking system

Foreign debt defaults are usually issued by global rating agencies such as Moody’s, Fitch and S&P, but the sanctions include a ban on rating Russian companies.

The default, announced on Monday, was the first in the years of existence of the Russian state (1918-1922 and 1991-2022), as well as the Soviet Union (1922-1991), which included the Russian Federation as one of the republics.

In 1998, the Russian government under President Boris Yeltsin defaulted on $40 billion of domestic debt due to the financial crisis.

Read also: The G7 are confident in the effectiveness of their sanctions against Russia

As Ukrinform reported citing Bloomberg, the grace period for Russia’s interest payments in the amount of approximately $100 million, which were due on May 27, expired on Sunday, and this is considered a default event.

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