The confidence of foreign investors is gone. Russian bond prices have collapsed.
(Photo: dpa)
Frankfurt Does the Kremlin pay or not? A new chapter is written almost every day in the saga of Russia’s bonds. To the surprise of many investors, the country, which is subject to severe sanctions, has so far been able to avoid a default. But the next big test is on Monday: A government bond worth two billion dollars will then mature and have to be repaid.
The confidence of foreign investors in particular is gone anyway. Russian bond prices have plummeted since Russia’s war of aggression against Ukraine began in late February.
Investors will probably be worried about payment for a long time to come. Ulrich Kater, chief economist at Dekabank, says: “A default is quite possible, the prospects for this are around 50:50.”
But is Russia really bankrupt? Why are Western sanctions making payouts so complicated? How many bonds does Russia have outstanding? And how great is the risk of a domino effect in the event of a Russian default? The Handelsblatt answers the most important questions:
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