Fitch: Russia is on the verge of bankruptcy

In the Russian financial markets, Western sanctions caused turmoil due to the occupation of Ukraine. The sanctions have raised significant concerns about the country’s ability to service debt and its willingness. Fitch has recalled the decision of Russian President Vladimir Putin to repay foreign currency debt in rubles to foreign creditors.

“Further intensification of sanctions and proposals to restrict energy trade will increase the likelihood that Russia will respond to a policy that includes at least selective non-payment of public debt obligations,” the credit rating said in a statement.

A rating of “C” is actually a rating of “in bankruptcy” or a rating of “near bankruptcy” in Fitch’s terminology. There is only one rating worse than the credit rating, which means bankruptcy of the state and a low chance of debt repayment.

Fitch’s rating is in line with Moody’s. company in the weekend Decided to divide Russia into category “Ca”, which indicates the approach of bankruptcy. (This is equivalent to Fitch’s current rating.)

In justifying Russia’s downgrade on Sunday, Moody’s highlighted that high-level sanctions imposed by Western countries after the invasion of Ukraine severely hampered Russia’s ability to meet its public debt repayment obligations on time.

It is noteworthy that Russia is calm Until the beginning of March He was in the investment grade category of credit rating agencies, even days after his dash to Ukraine.

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