S&P says new U.S. sanctions have no immediate impact on Russia’s ratings

FILE PHOTO: Skyscrapers of the Moscow International Business Centre, also known as
FILE PHOTO: Skyscrapers of the Moscow International Business Centre, also known as "Moskva-City", are seen from Ostankino tower on a frosty winter day in Moscow, Russia, January 8, 2017. REUTERS/Maxim Shemetov/File Photo

August 3, 2017

MOSCOW (Reuters) – The new round of U.S. sanctions against Moscow has “no immediate implications” for Russia’s sovereign credit ratings, S&P Global Ratings said on Thursday.

U.S. President Donald Trump grudgingly signed into law new sanctions against Russia on Wednesday, a move Moscow said amounted to a full-scale trade war and an end to hopes for better ties with the Trump administration.

The sanctions will affect a range of Russian industries and might further damage Russia’s economy, already weakened by a drop in oil prices and U.S. and European sanctions imposed in 2014 after the annexation of Crimea.

“Our outlook for Russia remains unchanged,” S&P said, adding it expects the economy to return to growth this year thanks to higher oil and gas prices.

“At the moment, it is unclear whether the new U.S. sanctions bill will further hamper what we currently regard as only modest medium-term economic growth prospects for Russia, since much will depend on how the bill will be implemented,” S&P said.

S&P, which is set to review its Russian ratings on Sept. 15, told Reuters last month that the outlook for the sovereign credit rating was clouded by the prospect of more sanctions.

S&P has Russia’s long-term foreign-currency rating one notch below investment grade at BB+, but revised its outlook on Russia to positive from stable in March.

(Reporting by Andrey Ostroukh; Editing by Catherine Evans)