Russian default wont trigger crisis, says IMFRussia may default on its debts in the wake of unprecedented sanctions over its invasion of Ukraine but that
would not trigger a global financial crisis, International Monetary Fund managing director Kristalina Georgieva said.
Georgieva told CBS that sanctions imposed by the United States and other democracies were already having a "severe" impact on the Russian economy and would trigger a deep recession there this year.
The war and the sanctions would also have significant spillover effects on neighboring countries that depended on Russian energy supplies, and had already resulted in a wave of refugees compared to that seen during World War Two, she said.
The sanctions were also limiting Russia's ability to access its resources and service its debts, which meant a default was no longer viewed as "improbable," Georgieva said.
Asked if such a default could trigger a financial crisis around the world, she said, "For now, no."
This came as Russian Finance Minister Anton Siluanov said sanctions had deprived Moscow of
access to US$300 billion (HK$2.34 billion) of its US$640 billion in gold and foreign exchange reserves and added that there was pressure on Beijing to shut off more.
"We have part of our gold and foreign exchange reserves in the Chinese currency, in yuan. And we see what pressure is being exerted by Western countries on China in order to limit mutual trade with China. Of course, there is pressure to limit access to those reserves," he said.
Meanwhile, Russia's coal and fertilizer king Andrei Melnichenko said the war in Ukraine is a tragedy that must be stopped or there will be a global food crisis, as fertilizer prices worldwide are already too high for many farmers.
Separately, the Russian central bank decided not to reopen stock market trading this week.
Source: Reuters
https://www.thestandard.com.hk/section- ... ,-says-IMF
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
by winston » Mon Mar 14, 2022 8:45 am 