Russia spirals to breaching debt default deadline for first time since 1988: Report

For first time in a century since ouster of last Emperor of Russia, Czar Nicholas II, and  Bolshevik revolution in 1988 Russia may be on edge of its first default on its foreign debt. Mosocw has at least three interest transfers pending totaling to an amount of $400 million which is due on Thursday and Friday. Russia's inability to make payments towards  dollar-issued debt in foreign currency, and inste  paying in own currency Roubles might  constitute a default because it breaches  terms of contract.

Moscow has a total of US$40 billion worth of debt in dollars and euros, majorly owned by foreign investors. And US Treasury earlier imposed restrictions on Russia's accounts against dollar debt payments. Moscow has alrey breached  terms on two bonds. It's Sunday deline is from previous missed payments  in May which expires at end of day on June 26. 

Defaulting on foreign debt would be a clear indicator that barrage of sanctions coordinated against Russia by West in response to its war in Ukraine are having desired effect on Russian economy. Moscow is unable to make payment in Dollars as it is unable to transfer cash. US and EU h earlier frozen Moscow central bank’s foreign reserves and disconnected Russia from SWIFT international financial system.

West-led asset blocks raised fears that Russia's president Vlimir Putin holds a 90% chance that his country will most likely default on foreing payment this year, ICE Data Services figures revealed. Immediately after sanctions, Russia paid an estimated $117 million in interest on dollar bonds as value of  debt holders' assets plunged due to sanctions. Moscow last defaulted in 1998, but on domestic debt. While Russia foreing bonds paid in dollars have a 30-day grace period, Russia's Finance Minister Anton Siluanov who serviced it Rubles iterated that it does not signify a "default." 

“We’ve done everything we can to le horse to water, but it’s not up to us wher it wants to drink or not,” Siluanov told state affiliated Tass. “Western countries are trying in every possible way to make Russia declare default,” he ded this week. 

Russia fulfils Eurobonds obligations using new mechanism 

Russia's finance minister earlier annoucned that Moscow "fulfilled all its obligations" on two dollar-denominated Eurobonds "in full" by making payments well in time. He iterated that Russian Federation has me interest payments in its own currency Roubles to its National Settlement Depository as it seeks to avoid sovereign default. President Vlimir Putin h signed a decree to make new rules that were aimed at fulfilling Russia's foreign debt obligations so nation does not default on debt.

Russian Finance Ministry h earlier snubbed suspicions that Moscow's Eurobond obligations are "in default." At a state presser, ministry iterated that Kremlin has enough funding to pay off its debts well in time and as per schedule. It furrmore noted that payments have been due to a few international investors as Russia decided to put it on hold owing to speculations of some illegal activities by American banks and US government as y refused to make payment to Russia in foreing currency. Russia, as a responsible borrower, has taken ditional efforts to protect rights of investors by reserving required amounts in rubles in a Russian depository, foreing ministry of Moscow h reiterated.