S&P confirms Russia’s rating at BBB-, outlook stable

MOSCOW, July 17. / TASS /. S&P Global Ratings announced on Friday that it had confirmed Russia’s foreign currency sovereign credit rating at BBB- / A-3 with a stable outlook.

“On July 16, 2021, S&P Global Ratings confirmed its“ BBB- / A-3 ”and“ BBB / A-2 ”long and short-term local currency sovereign credit ratings on Russia. The outlook for long-term ratings is stable, “the international rating agency said in a statement.

According to S&P, Russia’s strong external and fiscal balance sheets would be able to absorb risks to fiscal or financial stability resulting from the effects of the COVID-19 pandemic and possible additional international sanctions.

Pressure on ratings could intensify in the event of significantly tougher international sanctions, leading to large capital outflows and high risks to financial stability. The agency also leaves the possibility of negative rating action if the government’s balance sheet deteriorates significantly.

An upgrade would likely be based on reducing geopolitical risks and improving GDP growth, S&P said.

A rating hike could also appear if the government’s budget buffers significantly exceed the agency’s current expectations, “which could help mitigate volatility in commodity-related income,” and if effective policy measures are taken. are being taken to cope with the long-term fiscal pressures of an aging population.

Minister’s opinion

Russia’s Finance Ministry sees S&P Global Ratings’ decision to assert Russia’s foreign currency sovereign credit rating to BBB- / A-3 with a stable outlook as an illustration that its economic policies have been correct, said Friday Finance Minister Anton Siluanov to reporters.

“S&P Global Ratings’ decision to assert Russia’s sovereign currency credit rating at BBB- / A-3 with a stable outlook is seen by us as further confirmation that the government’s economic policy is correct,” said Siluanov.

By its own words, the agency has increased Russia’s expected economic growth in 2021 to 3.7 percent.

“According to the agency’s analysts, the current state of the Russian Federation’s balance sheet, balanced budget planning and the current floating exchange rate regime ensure that the Russian economy is sufficiently resilient to potential external shocks,” he said. added the minister.

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