Russian Budget to Adapt to New Reality, According to New Moody's Assessment

Russian Finance Minister Anton Siluanov said Saturday that Moody's recent decision to place Russia’s government bond rating on review for downgrade reflects the need for the country's budget to be adapted to new, harsher market realities.

MOSCOW (Sputnik) — Moody's decision to place Russia’s government bond rating on review for downgrade indicates the necessity for the budget to adapt to grim new market realities, Russian Finance Minister Anton Siluanov said Saturday.

On Friday, the rating agency said in a press release that it had placed Russia’s Ba1 government and issuer ratings on review for downgrade.

"Moody's assessment shows the need for adapting the budget system to new crude market realities," Siluanov told journalists.

According to the minister, Russia's government is working on the issue of the budget's medium-term balance, and measures to react to economic developments have been already prepared.

Siluanov added that the rating agency needed two months to complete the review.

"The Finance Ministry is due to stay in constant contact with agency's representatives and provide them with all the necessary information for a comprehensive and objective analysis of Russia's economy," the minister said.

In December, Moody’s changed the outlook for Russia’s Ba1 government bond rating from negative to stable. Then, the rating agency said that Russia’s external financial position would remain strong despite weak oil and gas prices.

The Russian economy suffered a setback in 2014, as the ruble lost about half of its value against the dollar amid low global oil prices and Western economic sanctions imposed against Russia over the situation in Ukraine.