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  Friday, December 13, 2019
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Standard & Poor’s to test Russia through low oil prices
MOSCOW - Addressing a seminar on Dec.16, representatives of Standard & Poor’s (S&P) rating agency explained why its Russia rating has so far remained unchanged, Kommersant reports. At present, Russia ratings stand at "BB+" and "BB" in foreign currency, which is lower than the minimum-investment rating, while Moody’s rating agency gives Russia "BBB-". In the report, S&P experts noted that the present growth of Russian economy depends mainly on high oil prices, which is expected to stop in case oil prices drop in the future because the economy is not diversified. The experts argue that such a scenario cannot be helped by any reserve fund or the Central Bank. To change the current trend, Russia must keep to the present showings for several years, a feat which is hardly possible to achieve. Summing it up, to get a higher rating, Russia must undergo a low oil prices test, which cannot happen sooner than a year. Helena Hessel, S&P leading analyst, explained that the positive macroeconomic showings in the local economy reflect only a good short-term perspective, while the S&P’s rating reflects the long-term perspective.
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