Russia‘۪s Sovereign Credit Rating Downgraded

Ratings agency, Moody‘s, downgraded Russia‘s credit rating on October 18 from Baa1 to Baa2, citing poor economic growth prospects, the effects of the Ukraine crisis, Western sanctions and accelerated capital flight.  According to Moody‘s, ‘‘‘The first driver for the downgrade‘‘_relates to the longer term damage the already weak Russian economy is likely to incur as a result of the ongoing crisis in Ukraine and, relatedly the additional sanctions imposed on Russia.‘  The agency went on to say that it was maintaining its outlook on Russia as ‘‘‘negative.‘  This development will likely increase Russia‘s borrowing costs and further complicate its access to foreign direct investment and Western financing, including interbank deposits.