Fitch on Tuesday downgraded Russia's sovereign rating by six notches further into the junk territory to 'C' from 'B', saying a default is imminent as sanctions and trade restrictions have undermined its willingness to service debt, APA-Economics reports citing Reuters.
The country's financial markets have been thrown into a turmoil by Western sanctions after it invaded Ukraine, raising significant concerns over its ability and willingness to service debt.
The rating firm pointed to Presidential decree, which could potentially force a redenomination of foreign-currency sovereign debt payments into local currency for creditors in specified countries.
"Further ratcheting up of sanctions and proposals that could limit trade in energy increase probability of a policy response by Russia that includes at least selective non-payment of its sovereign debt obligations," the ratings agency said in a statement.
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