FinMin Siluanov Says Russia Will Pay External Debt In Roubles, Raising Prospect Of Default

Russia's Finance Minister Anton Siluanov told state TV on Sunday that it is "absolutely fair" to pay foreign creditors in roubles until Western sanctions against Russia's central bank are lifted, with the government due to pay $117mn in interest on two dollar-denominated bonds on Wednesday, with a 30-day grace period. Neither of the two contracts allows payments in roubles and therefore such course of action would be tantamount with a default.

• Earlier this month, President Vladimir Putin signed a decree allowing Russia and Russian businesses to make interest payments to foreign creditors from "hostile countries" in roubles. Minister Siluanov used the same rhetoric Sunday, threatening to pay off our debt to these countries in the rouble equivalent."
• IMF chief Kristalina Georgieva said that a Russian default is no longer an improbable scenario, but would be unlikely to trigger a global financial crisis, as the total exposure of banks to Russia is not of "systemically relevant" scale.
• Siluanov claimed that Russia's central bank has lost access to around $300bn of its $643bn foreign reserves, adding that Moscow will count on China's help as it's trying to withstand the impact of Western sanctions.
• Meanwhile, U.S. National Security Adviser Jake Sullivan warned that Beijing would "absolutely" face consequences if it helped Moscow evade sanctions, as he prepares to meet with China's top diplomat Yang Jiechi on Monday.