http://money.cnn.com/2015/01/26/investing/russia-credit-rating-junk/index.html?iid=SF_BN_River
S&P has rated Russia's credit as junk.
This verdict will make it harder and very expensive for Russia to get loans. As Russian bonds have lost the investment grade, investors will have to sell their current Russian bonds.
Economic sanctions and oil down slide has worsened the economic situation of Russia. The Russians had expected that oil would sell this year over $100 a barrel but the it is currently being sold for $45 a barrel.
Russia's central bank has hiked the interest rate by five times to strengthen the ruble. Thus, this is a clear indication that Russia is facing a financial crisis.
Russia's central bank has claimed that it will fund an emergency loan of $545 million to protect the deposits. However, Russia will then have to protect itself from inflation.
Russia's currency has plunged by 40% of it's value against the USD and S&P expects an inflation of 10%.
S&P has rated Russia's credit as junk.
This verdict will make it harder and very expensive for Russia to get loans. As Russian bonds have lost the investment grade, investors will have to sell their current Russian bonds.
Economic sanctions and oil down slide has worsened the economic situation of Russia. The Russians had expected that oil would sell this year over $100 a barrel but the it is currently being sold for $45 a barrel.
Russia's central bank has hiked the interest rate by five times to strengthen the ruble. Thus, this is a clear indication that Russia is facing a financial crisis.
Russia's central bank has claimed that it will fund an emergency loan of $545 million to protect the deposits. However, Russia will then have to protect itself from inflation.
Russia's currency has plunged by 40% of it's value against the USD and S&P expects an inflation of 10%.
2 comments:
Russia seems to be in the race of countries joining Venezuela. Oil prices have effected numerous oil producing countries some worse than others. The oil prices coupled with economic sanctions on the country due to questionable behavior has certainly put Russia in a precarious situation. My question to this would be, if Russia continues to slide down into further trouble, will the economic sanctions finally cause Russia to clean up its act enough to get out from under these sanctions?
It seems like everyday we hear something about the Russian economy getting worse and worse as the days pass by. Russia has put itself in a big hole and I believe Russia is digging its own grave. Putin has not helped the Russian economy at all with the whole Ukrainian/Russian crisis. His obsession with gaining parts of Ukraine back under Russian rule has had detrimental effects on the Russian economy. These effects have drastically influenced the collapse of the Ruble and the Russian Economy. The economic sanctions enforced on Russia will not help Russia's economic situation at all. The amount of negative attention Russia has drawn to itself within the past year has caused them to lose alliances between other countries and they may not have anyone willing to bail them out if need be. It will be interesting to see what happens to the Russian economy and the Ruble over the course of the year.
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