NEW YORK (AFP, BLOOMBERG) - Ratings agency Fitch on Tuesday (March 8) again downgraded Russia's sovereign debt rating farther into junk territory from "B" to "C", saying the decision reflects the view that a default is "imminent".
The default may come as soon as April 15, which will mark the end of a 30-day grace period on coupon payments the Russian government owes on US dollar bonds due in 2023 and 2043, Morgan Stanley's Simon Waever said in a note.
If Russia were to default on a debt payment, it would be the first time since 1998.
Like other major ratings agencies, Fitch had already slashed Russia's rating earlier this month to "junk" status, or the category of countries at risk of not being able to repay their debt.
"The 'C' rating reflects Fitch's view that a sovereign default is imminent," the agency said in a statement, adding its new downgrade came because recent developments had "further undermined Russia's willingness to service government debt".
The agency said: "The further ratcheting up of sanctions, and proposals that could limit trade in energy, increase the probability of a policy response by Russia that includes at least selective non-payment of its sovereign debt obligations."
On Tuesday, the United States and Britain announced they were cutting off Russian energy imports - the US ban is effective immediately, while London said it would phase out oil imports by the end of the year.
Moody's Investors Service cut Russia earlier this week deeper into junk, while S&P Ratings has the nation three levels above a default score.
Russia is contending with the economic sanctions that have piled up and left the country increasingly isolated since the war began.
Fitch cited a step that could force foreign-currency-denominated bonds to be repaid to some creditors in Russian roubles, which have plunged in value since Russia's invasion of Ukraine.