Russia welcomes good news on its bond ratings. An authoritative international rating agency Moody’s one more time revised its outlook for Russia. Lately, everyone has got used to a series of downward revisions, but this time the situation is quite the opposite. Experts at Moody’s international agency changed the outlook from “negative” to “stable” for Russia’s government bonds. According to the report, Russia’s economic indicators are now losing direct connection with oil prices. Besides, those indicators become less dependent on the developments in eastern Ukraine. Another reason to raise the rating was stabilization of Russia’s external finances. A timely macroeconomic adjustment was able to cut losses and mitigate the effect of the ongoing plunge in global oil prices. One more driver for lifting the outlook was the diminished likelihood of the so called intense shock from sanctions imposed against Russia by other countries. Nevertheless, this risk factor is going to loom over Russia’s economy over the next 12-18 months. Analysts with Moody’s strongly emphasized in their report that “the relative stability in eastern Ukraine suggests a lower likelihood of sanctions being tightened” against Russia. However, very few people believe that sanctions will be lifted right away. Russia’s economy will extend losses unless the military conflict comes to an end and the parties express full readiness to implement Minsk agreements.
