S&P Downgrades Russia’s Credit Rating To Below Investment Grade

H/t reader squodgy:

“If a an IMF/Fed puppet ratings agency classes one as junk….it must be good news.”

Related info:

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S&P downgrades Russia’s sovereign credit rating to below investment grade (CNBC, Jan 26, 2015):

Standard & Poor’s on Monday downgraded Russia’s sovereign credit rating to below investment grade, as the country’s economy continues to weaken.

S&P slashed Russia’s sovereign credit rating to BB+ from BBB- and said the outlook is negative, reflecting its view that Russia’s monetary policy flexibility could diminish further.

This is the first time in more than 10 years that Russian sovereign debt has been rated below investment grade, in what some call “junk” territory.

The U.S. dollar rose more than 5 percent against the ruble after the news broke.

It could not only harm Russia’s image among investors, but also push up its borrowing costs, as many mainstream investment and pension funds have rules preventing them from buying anything not classed as investment grade.

The ratings agency said Russia’s financial system is weakening and therefore limiting the Central Bank of Russia’s (CBR’s) ability to transmit monetary policy.

It sees the CBR facing “increasingly difficult monetary policy decisions while also trying to support sustainable GDP growth.”

S&P said it could cut the rating again if “external and fiscal buffers deteriorate over the next 12 months” faster than it expects.

2 thoughts on “S&P Downgrades Russia’s Credit Rating To Below Investment Grade

  1. S & P, the same swine who gave grade A to junk bonds, MBS’s, and applauded Enron, Madoff, and other total crooks. Why they are in business is beyond understanding. Why did they keep their jobs after their crooked ratings destroyed the world economy? Even Reagan put Anderson Accounting out of business…..this is beyond belief.

    If I were Russia, I would see this as an A+++. The US is really scared. Bombing Yemen……just south of Saudi Arabia due to OPEC kicking the Petrodollar to the curb last month………you cannot bomb your way back into credibility. The more the US acts like this, the more likely the Saudis and Kuwait kings will replace US troops with Russian or Chinese……..the whole system is changing and the US is outside looking in.

    Not all the bombs in the world will restore US financial dominance. It is over, and they would be wise to go home and learn to act as a nation among nations. That is all they are now, and if they keep up this insanity, the Euro will toss them out next. If the Euro kicks them out, the dollar will collapse.

    The dollar will collapse with the EU, but acting like they are civilized might slow the process.

  2. Stanley, didn’t see your statement until after I posted. I agree completely, and Russia would be wise to treat it in the same manner and not bother reacting…….it is the screams of an impotent childish tantrum, nothing more.

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