Moody’s holds Russian bond rating at Ba1 as economy shows resilience

Russian bond rating: Rappler

The international credit rating agency Moody’s Investors Service has confirmed Russia’s government bond and issuer ratings at a negative Ba1. In a statement issued late last week, it explained that its decision to uphold the findings of the review that it initiated earlier this year was based on the resilience that the Russian economy had displayed  in the face of the renewed drop in oil prices early this year thanks to an effective blend of macro policy responses; and that Moscow’s ongoing fiscal adjustments  appeared to be  sufficient to reduce the 2016-18 deficits to a level that meant it could  be financed in the domestic capital markets and through fiscal reserve drawdowns.
However, its statement also pointed out  the negative outlook  reflected  the likely further erosion of the government’s fiscal savings in the context of Moody’s medium-term projections for oil prices. A set of policies that would address the economy’s low growth potential had additionally been slow to emerge, while the election calendar over the next two years was  likely to interfere with the implementation of politically unpopular reforms that could achieve a more fundamental budget consolidation.

Source: moodys