Russia has supposedly defaulted on its external sovereign bonds for the first time since 1918. This is the culmination of severe Western economic sanctions preventing Russia from accessing its regular payment routes for its overseas creditors.
The country defaulted on about $100 million of interest payments despite having the resources to pay its bills because Moscow was blocked from accessing international financial transaction systems by the sanctions.
"With Russia benefiting from the high price of its energy exports, it clearly has both the means and the desire to pay its foreign debt," said Giles Coghlan, chief analyst for financial company HYCM Group. "It's a default in a technical sense, so many investors may be prepared to wait it out."
Russia itself has already rejected claims that it has defaulted on its debts. On Monday, June 27, the Kremlin called an external label placed on the country's debts to be unlawful. Russian Finance Minister Anton Siluanov has also been saying for weeks now that any default declaration by the West would be artificially manufactured by the economic sanctions placed upon the country.