LONDON, December 23 (Sputnik) — Moody's Investors Service said Tuesday it had downgraded to Baa2 from Baa1 the foreign currency rating of Russia's energy giant Gazprom with negative outlook.
"This action reflects the ongoing severe and rapid deterioration in the operating environment in Russia and the heightened risk of a more prolonged and more acute economic downturn than originally anticipated," Moody's said in a statement.
Moody's added that the decision also reflects "recent volatility in the rouble exchange rate, which has surpassed the heightened levels already experienced in 2014."
The agency also said it had put 45 Russian non-financial corporates and their subsidiaries on review for a downgrade, warning that even companies without refinancing needs in foreign currency could be weakened in a severely deteriorated operating environment.
At the same time, Moody’s acknowledged the strength of Gazprom’s franchise, saying the agency could yet stabilize the outlook on the gas giant’s ratings if the outlook on Russia's government bond rating stabilized as well.
This downgrade followed Moody’s decision to cut the ratings on Russia's foreign currency bond ceiling to Baa2 from A3 on Monday. It also lowered the ceiling of foreign currency deposits to Ba1 from Baa2, and ceilings of the local currency bond and deposits to Baa1 from A3.
The Russian national currency has contracted by more than half of its value to dollar since July due to the falling global oil prices and Western economic sanctions, prompting the head of the country’s Central Bank to predict a 10-percent inflation rate in 2014, as well as in the first quarter of 2015.
Earlier this month, the Central Bank hiked interest rates first to 10.5 percent from 9.5, and just a while later to 11.5 percentage points in an effort to stabilize the ruble, also this measure had but a limited effect on the depreciating currency.
