Following a barrage of global economic sanctions the West effectively “took down Russian finances in one day” and Moody’s Investors Service has downgraded Russia to junk.
Credit rating firms Moody’s, S&P and Fitch said the sanctions imposed on Russia has weakened Moscow’s economy.
Russia’s credit rating has been downgraded to “junk” and last week S&P made the same assessment that they have no confidence in the Russian economy.
Fitch said in a statement, “The severity of international sanctions in response to Russia’s military invasion of Ukraine has heightened macro-financial stability risks, represents a huge shock to Russia’s credit fundamentals and could undermine its willingness to service government debt.”
Swedish economist Anders Aslund tweeted on Wednesday that the Western sanctions effectively “took down Russian finances in one day.”
Aslund added, “The situation is likely to become worse than in 1998 because now there is no positive end.
“All Russia’s capital markets appear to be wiped out & they are unlikely to return with anything less than profound reforms.”
Russian banks have been removed from the global financial system and the Rouble has plummeted in just one week.
Large Russian banks have been isolated as they have been removed from the SWIFT international payments system.