DOES RUSSIA REALLY CARE FOR WHAT S&P SAID?

DOES RUSSIA REALLY CARE FOR WHAT S&P SAID?

Notice that S&P are champions manipulating data
 

FURIOUS RUSSIA, DOWNGRADED TO JUST ABOVE JUNK BY S&P, PROPOSES "SCORCHED EARTH" RETALIATION AGAINST NATO COUNTRIES

Submitted by Tyler Durden on 04/25/2014

http://www.zerohedge.com/news/2014-04-25/furious-russia-downgraded-just-above-junk-sp-proposes-scorched-earth-retaliation-aga

[Here only extracts]

WSJ reports:

"In our view, the tense geopolitical situation between Russia and Ukraine could see additional significant outflows of both foreign and domestic capital from the Russian economy and hence further undermine already weakening growth prospects," S&P wrote in its report.

Moscow's MICEX stock index fell by 1.5% after the move. The ruble weakened 0.6% against the dollar to 35.977.

A further cut to junk status would be a big move, given Russia's relatively modest level of debt, according to Tim Ash, an economist at Standard Bank.

"But if the crisis in Ukraine deteriorates further, and we see sustained capital flight and pressure on the ruble and Russian markets further, then it is possible," he said.

Russia's response was prompt.

In retaliation to the downgrade, Russian presidential adviser Sergei Glazyev proposed plan of 15 measures to protect country’s economy if sanctions applied.

• Russia should withdraw all assets, accounts in dollars, euros from NATO countries to neutral ones
• Russia should start selling NATO member sovereign bonds before Russia’s foreign-currency accounts are frozen
• Central bank should reduce dollar assets, sell sovereign bonds of countries that support sanctions
• Russia should limit commercial banks’ FX assets to prevent speculation on ruble, capital outflows
• Central bank should increase money supply so that state cos., banks may refinance foreign loans
• Russia should use national currencies in trade with customs Union members, other non-dollar, non-euro partners

In other words, a full-blown scorched earth campaign by Russia. 

Finally, those curious what are the linkages between the west and Russia are, review our recent post on the matter: All You Need To Know About Russia, In Charts.

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