Wednesday, November 26th0.9°C
24157

S&P cuts Russia's credit rating in the wake of Ukraine crisis

MOSCOW - The Standard & Poor's credit agency on Friday cut Russia's credit rating for the first time in more than five years, raising the financial stakes flowing from the crisis in Ukraine as tensions rise and the United States and its allies are contemplating further economic sanctions.

In southeastern Ukraine, seven people were injured early Friday by a blast at a checkpoint set up by local authorities and activists outside the Black Sea port of Odesa. Local police spokesman Volodymyr Shablienko said unknown men had thrown a grenade at the checkpoint.

A senior official travelling in Asia with President Barack Obama said he is likely to call European leaders Friday to discuss the possibility of further sanctions. The official spoke on condition of anonymity because there had been no official announcement.

Russia announced new military exercises Thursday involving ground and air forces near its border with Ukraine, swiftly responding to a Ukrainian operation to drive pro-Russia insurgents out of occupied buildings in the east. At least two people were killed in a clash at a checkpoint.

The ratings agency's main concerns the flight of capital and the risk to investment in Russia since the Ukraine crisis blew up late last year.

Credit ratings are important for the economy because they determine how expensive it will be for a country or company to borrow on international markets.

Russia's economic growth slowed to 0.8 per cent in the first quarter, sharply worse than earlier forecast while spooked investors pulled about $70 billion out of the country — more than in all of 2013. However, the cut in Russia's rating from BBB to BBB- is the most tangible economic result of Russia's policies toward Ukraine so far.

BBB- is just a step above the so-called "junk" level.

S&P said in a statement that the revised Russia's rating because the tense situation "could see additional significant outflows of both domestic and foreign capital from the Russian economy."

Rating agencies had not cut Russia's sovereign rating since December 2008.

Russian Economic Development Minister Alexei Ulyukayev sought to play down the downgrade, calling it "partly politically motivated."

Moscow in March recognized a hastily called referendum in Ukraine's Black Sea peninsula of Crimea and annexed it weeks later, attracting condemnation of the West as well as sanctions targeting individuals. Secretary of State John Kerry on Thursday warned Moscow that unless it took immediate steps to de-escalate the situation, Washington would impose additional sanctions.

___

AP reporter Julie Pace in Seoul contributed to this report.

The Canadian Press


Read more Business News

23872


Recent Trending




Today's Market
S&P TSX15038.41-35.24
S&P CDNX771.06-9.58
DJIA17827.7512.81
Nasdaq4787.317+29.065
S&P 5002072.83+5.80
CDN Dollar0.8881-0.0008
Gold1188.00-8.60
Oil72.82-0.87
Lumber327.90-1.60
Natural Gas4.295+0.144

 
Okanagan Companies
Pacific Safety0.160.00
Knighthawk0.01-0.005
QHR Technologies Inc1.34+0.02
Cantex0.045+0.005
Anavex Life Sciences0.171-0.004
Metalex Ventures0.035+0.005
Russel Metals31.50-0.64
Copper Mountain Mining2.16+0.01
Colorado Resources0.12-0.01
ReliaBrand Inc0.0134-0.0001
Sunrise Resources Ltd0.045-0.005
Mission Ready Services0.34+0.015

 
23744


22970

FEATURED Property
19557272751 Casa Loma Road
4 bedrooms 3 baths
$1,725,000
more details
image2image2image2
Click here to feature your property
Please wait... loading


The last great Canadian tax shelter

A guide to how flow-through fund limited partnerships can mightily aid your tax planning!The end of the year will raise concerns among many professionals, self-employed persons, business owners and ev...


What I learned in China: Part 2

As per my previous article on my visit to China, we have much to learn about and from their people. It is potentially the largest market on earth with 1.3 billion people in one country but much will d...


Retirement: Health Issues

Our health is really our greatest asset and maintaining our health is of tremendous importance. You want to do what you can to ensure that health issues will not jeopardize the enjoyment of your retir...

_



24185

24231


Member of BC Press Council


24003