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Russia used domestic dollar reserves to avoid default

Russia used the non-sanctioned bank Dom.RF to make the payment. < /p>

Russia tapped its domestic dollar reserves to make payments on two foreign bond issues and avoid a sovereign default. The United States allowed the transaction, reports the with reference to TSN.

The United States is trying to ensure that the Russian Federation uses its internal reserves, which will reduce its ability to finance an invasion of Ukraine.

According to the source, Russia used the Dom.RF bank, which was not sanctioned, to make the payment. He sent the payment to Bank of New York Mellon Corp.'s correspondent bank, which sent the payment to Citigroup.

The agency's interlocutor noted that Citigroup is unlikely to process the payment until it receives approval from US and UK regulators. The payment process to Russian Eurobond holders has not yet been completed.

Earlier it became known that Russia applied to Brazil for support from the International Monetary Fund, the World Bank and the G20 group of leading economies. This will help it resist sanctions due to the invasion of Ukraine.

Recall that the international rating agency S&P downgraded Russia's foreign currency credit rating to SD, which means «selective default» . The credit rating in rubles remained at CC – default has not yet occurred, but it is expected that it will become almost inevitable.

The agency downgraded Russia's foreign currency rating after the Russian Ministry of Finance for the first time since the start of the war against Ukraine and the introduction of new sanctions could not pay off Eurobonds in dollars and transferred these payments in rubles.

Russia already experienced a default in 1998, then this provoked the devaluation of the ruble and rising prices.


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