One less letter and more worry. The rating agency Fitch again lowered its rating on Russia’s debt on Tuesday from “B” to “C”, in view of “developments which have further undermined Russia’s willingness to repay the public debt”. According to her, the risk of default by the Kremlin is “imminent”, due to the massive sanctions imposed following the invasion of Ukraine , weakening the Russian economy as never since the end of the USSR.
At the beginning of March, Fitch, like the other major agencies Standard & Poor’s and Moody’s, had already placed the rating of Russian long-term debt in the category of countries likely to be unable to repay. Judging by market levels, Russia’s default probability is now 80% from 50% a week ago. However, the lower the confidence and the rating, the less the lenders will trust the country and the less it will be able to borrow money at reasonable interest rates.
