Russia continues to be rated 'junk'

(Baonghean.vn)- On April 23, credit rating agency Moody's affirmed that Russia's credit rating remains at the lowest level, Ba1. This is the highest risk level for investors and businesses wanting to do business here.

Russia receives “junk” credit rating from major rating agencies. Photo: TASS

The reason Moody's maintains the Ba1 credit rating as above is because the economy is slowing down due to falling oil prices, the maintenance of Western sanctions, plus the devaluation of the domestic currency, high inflation will create unfavorable conditions for businesses operating here as well as for consumer confidence.

Moreover, a series of policies to adjust the economy's low growth momentum has not yet been effective, while the presidential election in two years is likely to lead to unpopular political reforms.

Russia's fiscal risks are rising amid external pressure. Photo: TASS

Moody's also forecasts that if oil prices stay at $33 a barrel in 2016, Russia's federal budget deficit will increase to approximately 3% of gross domestic product (GDP) this year.

Previously, in 2015, Moody's twice downgraded Russia's credit rating to its lowest level.

According to JPMorgan Chase & Co, Moody's negative assessments of Russia's economic outlook are expected to greatly affect foreign investors' decisions before buying bonds issued in Russian currency./.

Lan Ha

(According to TASS)