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Russia to stick to economic tasks despite rating downgrade — finance minister

February 24, 2015, 12:28 UTC+3 MOSCOW
Moody’s international rating agency downgraded Russia’s sovereign debt to Ba1 from Baa3 with a negative outlook over the country’s "deteriorating economic and financial strength"
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Russia's Finance Minister Anton Siluanov

Russia's Finance Minister Anton Siluanov

© Ilya Pitalyov/TASS

MOSCOW, February 24. /TASS/. The Russian government will continue implementing its economic decisions, despite its rating downgrade to the non-investment grade by another international rating agency, Finance Minister Anton Siluanov said on Tuesday.

Moody’s international rating agency downgraded Russia’s sovereign debt to Ba1 from Baa3 with a negative outlook over the country’s "deteriorating economic and financial strength." Standard & Poor's lowered Russia’s sovereign credit rating on January 26 to the speculative grade BB+ from the investment level BBB-, with a negative outlook.

"We must conduct tight monetary and fiscal policy. We must adjust the budget and the economy to new conditions," the finance minister said.

"Irrespective of what rating agencies’ actions are, we need to strictly comply with the decisions the government has adopted in the area of social and economic development," the minister said.

Russia’s finance minister earlier called Moody’s decision to cut Russia’s sovereign rating to speculative grade "overly negative" and based on an extremely negative scenario.

"I believe that Moody’s rating is not just overly negative, but also based on an extremely pessimistic forecast, unparalleled these days," Siluanov said.

Moody's said in comments on the rating downgrade that the existing and potential future international sanctions, the erosion of Russia’s foreign exchange buffers and persistently lower oil prices plus high and rising inflation would take a negative toll on incomes as well as business and consumer confidence.

"As a result, Russia is expected to experience a deep recession in 2015 and a continued contraction in 2016. The decline in confidence is likely to constrain domestic demand and exacerbate the Russian economy's already chronic underinvestment," the rating agency said.

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