Moody’s says can downgrade Russian credit rating in 2 months

MOSCOW, Mar 9 (PRIME) -- Rating agency Moody’s has placed Russia’s rating on review for a downgrade within two months, but retained the rating at the highest grade of the speculative range Ba1 so far, according to a statement of the agency published late March 4.

“During the review, Moody's will assess the extent of the impact of the further sharp fall in oil prices, which Moody's expects to remain low for several years, on Russia's economic performance and government balance sheet, including the government's deficit financing options, in the coming years,” the agency said.

According to Moody’s, the ruble devaluation will not help the Russian economy to a great extent because of its structural ailments. The measures announced earlier by the government to combat the effect of low oil prices on the economy and state budget revenue seem to be not enough: “The plans announced to date are unlikely to be sufficient to contain entirely the impact of the shock on the government's balance sheet,” it said.

Moody’s will primarily access the measures and the capability of the Russian authorities to mitigate the crisis, it said.

The agency said separately that the continuation of the low oil price period can mean Russia’s gross domestic product growth by only 4% in the next four years.

Russian Finance Minister Anton Siluanov said that the Moody’s move shows the importance of the Russian budgetary system’s adaptation to the new realms. The Finance Ministry will stay in touch with Moody’s in the nearest future, he said.

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