Russia has missed the deadline on payment of its foreign-currency sovereign debt for the first time in a century as the 30 day grace period on about $100m of two bond payments due on May 27 expired on Sunday. Al Jazeera reports that the Kremlin has repeatedly said there are no grounds for Russia to default but it is unable to send money to bondholders because of sanctions, accusing the West of trying to drive it into an artificial default. While a formal default would be largely symbolic given Russia cannot borrow internationally at the moment and doesn’t need to, thanks to rich oil and gas revenue, the stigma would probably raise its borrowing costs in future.
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