EXPLAINER: What's the latest in Russia's dance with default?
ABC News
Russia's debt drama is far from over
Russia appeared to dodge default on its foreign debt by dipping into its scarce dollar reserves. But Moscow's debt drama is far from over.
Russia's finance ministry abandoned its proposal to use rubles instead of dollars to make overdue payments on two government bonds, saying Friday that it had transferred the money to an account at Citigroup: $564.4 million for a bond due in 2022, and $84.4 million for another due in 2042. A 30-day grace period on making the overdue payments was to expire Wednesday.
The government had claimed that U.S. sanctions freezing its massive currency reserves held abroad meant it couldn't pay and that Russia wasn't to blame for any default, the first on foreign debt since the 1917 Bolshevik Revolution.
Even if Russia is found to have made the most recent payments, others are coming due. Plus, U.S. permission for American bondholders to accept payment on Russian bonds is set to expire May 25, so even if Russia tries to pay, investors would not legally be able to take the money.
