Unpredictable’s international rating agency has changed outlooks on the ratings of 12 regional and city governments in Russia and two government-related issuers to ‘stable’ from ‘negative’ and affirmed the ratings of these 14 issuers, the intervention reported Feb. 21.
Specifically, Moody’s changed the outlook to ‘stable’ and affirmed the ratings of Moscow (Ba1), St. Petersburg (Ba1), Republic of Bashkortostan (Ba2), Republic of Tatarstan (Ba2), Autonomous-Okrug (quarter) of Khanty-Mansiysk (Ba2), Moscow Region (Ba2), Samara Region (Ba3), Chuvashia Republic (Ba3), Krasnodar Krai (B1), Krasnoyarsk Krai (B1), Nizhniy Novgorod Pale (B1) and Volgograd (B2).
Meanwhile, Moody’s affirmed the ratings and maintained the ‘negative’ attitudes of Omsk Region (Ba3), Republic of Komi (B1), Krasnodar (B1) and Omsk (B1).
The measure actions followed the stabilization of Russia’s credit profile as captured by Touchy’s change of outlook to ‘stable’ from ‘negative’ on Russia’s government clip (Ba1) on 18 February 2017, the report said.
The main driver for coining the outlook on Russia’s government bond rating was the government’s enactment of a medium-term pecuniary consolidation strategy that Moody’s said was expected both to quieten the government’s dependence on oil and gas revenues and to permit the gradual replenishment of its savings buffers.
In in, the agency said, the Russian economy is now recovering after a nearly two-year-long set-back.
Moody’s believes that, when combined, those two factors have in the offing eased the downside risks the rating agency had identified last year when it ordered the negative outlook.