EXPLAINER: What would a Russian bond default mean?
Ratings agencies say Russia is on the verge of defaulting on government bonds following its invasion of Ukraine, with billions of dollars owed to foreigners. That prospect recalls memories of a 1998 default by Moscow that helped fuel financial disruption worldwide.
The possibility has become more than market speculation after the head of the International Monetary Fund, Kristalina Georgieva, conceded that a Russian default is no longer an ”improbable event.”
A look at possible consequences from a Russian default:
WHY ARE PEOPLE SAYING RUSSIA IS LIKELY TO DEFAULT?
On Wednesday, Russia faces an interest payment of $117 million on two bonds denominated in dollars. Western sanctions from the war in Ukraine have placed severe restrictions on banks and their financial transactions with Russia. Finance Minister Anton Siluanov has said the government has issued instructions to pay the coupons in dollars, but added that if banks are unable to do that because of sanctions, the payment would be made in rubles. There’s a 30-day grace period before Russia would be officially in default.
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https://apnews.com/article/russia-ukraine-business-europe-moscow-13f0c5553ae745f37d8c13ab3bc2378f
