S&P affirms Russia’s rating at BBB-, outlook stable

MOSCOW, Jul 20 (PRIME) -- International rating agency S&P Global Ratings (S&P) has affirmed Russia’s long- and short-term foreign currency and local currency sovereign ratings at BBB-, with a stable outlook, the agency said late on July 17.

“We are therefore affirming our BBB-/A-3 foreign currency and BBB/A-2 local currency sovereign credit ratings on Russia,” S&P said.

The agency believes that lower oil prices, oil production cuts under the OPEC+ agreement, and the adverse effects of the COVID-19 pandemic will prompt the Russian economy to shrink by 4.8% in 2020.

“The stable outlook reflects our expectation that Russia’s strong external and fiscal balance sheets would be able to absorb risks to fiscal or financial stability, stemming from lower oil prices and the effects of the COVID-19 pandemic,” S&P said.

Finance Minister Anton Siluanov said the agency’s decision to affirm Russia’s rating confirms that the government’s policy ensures macroeconomic stability amid an extremely volatile external environment.

“The confirmation of the credit rating of Russia at the previous level is evidence that conservative budget planning, inflation targeting policy and strict adherence to the budget rule, the preservation of which was recently confirmed by Russian President Vladimir Putin, allow the Russian economy to successfully absorb external shocks,” Siluanov said.

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