Russia’s Finance Ministry prepares to service part of its foreign currency debt on Wednesday, but these payments will be made in rubles if sanctions prevent banks from paying debt in the currency of issue, the ministry warned on Monday, according to Reuters.
Next Wednesday is crucial, as the Russian state will have to repay $ 117 million as two European bonds expire. However, there is a grace period of 30 days, so bankruptcy will not officially occur until at least April.
Nearly half of Russia’s gold and foreign exchange reserves were frozen due to sanctions.
“Desperate to maintain the value of the ruble in Russia, on March 8 the Kremlin issued a new decree banning Russians from exchanging rubles for hard currencies such as the US dollar or the euro. This essentially turned the ruble into a currency that has value only in one fantastic economy in Russia, where people are not allowed to buy what they want, “comments ABC.
The ruble rose 12% to $ 118 on Wednesday.
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