sanctions against Russia
IMF: Moscow’s default “no longer unlikely”
The IMF considers a Russian default to be “no longer unlikely”. Photo: Jim Lo Scalzo/EPA/dpa
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The IMF warns that Russia is at risk of a “deep recession” in view of the sanctions imposed in response to the Ukraine war. A payment default is also conceivable.
In view of the largely blocked Moscow foreign exchange reserves, a default by Russia in relation to its debts abroad is “no longer unlikely”, according to the International Monetary Fund (IMF).
Because of the sanctions imposed against Ukraine as a result of the war of aggression, Russia is threatened with a “deep recession”, warned IMF boss Kristalina Georgieva in an interview with the TV channel CBS on Sunday. The devaluation of the national currency, the ruble, has already led to the fact that the purchasing power of the people in Russia has “shrunk significantly”.
The international foreign exchange reserves of the Russian central bank are largely blocked as a result of sanctions. This has made it more difficult for Russia to defend the ruble’s exchange rate if necessary. In addition, servicing government debt in foreign currencies such as the US dollar or the euro is becoming significantly more complicated. “I can say that we no longer regard a Russian default as an unlikely event,” Georgieva said. “Russia has the money to service the debt, but it doesn’t have access to it,” she said.