More Pain Lies Ahead For Russia As S&P Downgrade To Junk Status Seen Likely

EMerging Equity

A reflection of a yearly chart of U.S. dollars and Russian roubles are seen on rouble notes in this illustration picture taken in WarsawMore pain may lie ahead for Russia in the short term as the nation’s sovereign credit rating is on the horizon of being downgraded into junk territory for the first time in over a decade.

On Friday, Fitch Ratings downgraded Russia’s sovereign rating to ‘BBB-‘ (from BBB) – which happens to be the lowest investment grade before the notorious “junk status” – in addition to placing Russia on a negative watch outlook.

The news from Fitch is another bruise for Russia, whose economy has been battered amid sanctions and turmoil.

However, the move by Fitch comes as no surprise as it was widely expected by investors.

Russia, once a powerful BRIC nation (Brazil, Russia, India, China) amongst its emerging market peers, will remain a dominant piece of the puzzle in the long term, however short-term issues will need to be ironed out to ensure future prosperity and to ease investor concerns.

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About Ahmed Islamov

I was born and raised in Uzbekistan and lived in that country for about two thirds of my life. I left the country about 14 years ago but sustained tight bonds with my family and friends living there. I know and communicate personally with hundreds of people including blue-, white- or pink-collar workers. I am naturally very attached to and concerned with everything that is going on there.
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