Russia braces for first default since Bolshevik Revolution Business

Liam Peach, Russian economist at Capital Economics, said: “There was nothing in the contract that would allow Russia to pay in rubles. If it goes ahead, it’s probably some kind of technical fault.

Fitch and Moody’s have withdrawn their credit ratings for Russia’s sovereign debt, but S&P may still consider the country in default.

A default could have lasting economic consequences as Russia risks being shunned by investors and will have to face a long climb in the credit rating scale.

Mr Peach said the sanctions and default would prevent Russia from accessing global debt markets for “a period of time”, with Moscow facing “very high” interest rates.

“If the Russian government defaults, it could potentially trigger a wave of corporate defaults in Russia.”

It came as new figures revealed the crushing blow to Russian trade from Western sanctions.

Imports into Russia plunged a tenth in March from the previous month while exports fell 5% as Russian products were shunned by the West, according to the Kiel Institute. Global trade fell 3% last month as supply chains were disrupted by the conflict.

Vincent Stamer, head of the Kiel Trade Indicator, said: “The real distortions caused by Russia’s invasion of Ukraine and the sanctions imposed by the West, as well as a high level of uncertainty among companies with ties to Russia, significantly pull back March trade.”