Russia makes last-gasp dollar bond payments in bid to avoid default

An indication is on show exterior Russia’s Finance Ministry constructing in Moscow, Russia March 30, 2021. An indication reads: “Ministry of Finance of the Russian Federation”. REUTERS/Maxim Shemetov//File Picture

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April 29 (Reuters) – Russia made what gave the impression to be a late u-turn to keep away from a default on Friday, because it made a variety of already-overdue worldwide debt funds in {dollars} regardless of beforehand vowing they might solely be paid in roubles.

Whether or not the cash would make it to the USA and different Western international locations that sanctioned Russia was nonetheless not clear, nevertheless it represented one other main twist within the sport of economic hen that has developed a few potential default.

Russia’s finance ministry stated it had managed to pay $564.8

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million on a 2022 Eurobond and $84.4 million on a 2042 bond in {dollars} – the forex specified on the bonds.

The ministry stated it had channeled the required funds to the London department of Citibank, one of many so-called paying brokers of the bonds whose job is to disburse them to the traders that initially lent the cash to Moscow.

Russia has not had a default of any variety since a monetary crash in 1998 and has not seen a serious worldwide or ‘exterior’ market default because the aftermath of the 1917 Bolshevik revolution. learn extra

The danger of one other one although is now a flashpoint within the financial tussle with Western international locations which have blanketed Russia with sanctions in response to its actions in Ukraine that Moscow has termed a “particular army operation”.

The bonds had been initially presupposed to be paid earlier this month however an additional 30-day ‘grace interval’ that authorities bonds typically have of their phrases meant Moscow’s closing deadline was on Might 4. learn extra

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Reporting by Reuters
Enhancing by Tomasz Janowski

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