Updated 01:22 a.m. Moscow Time
MOSCOW, October 18 (RIA Novosti) - Moody's international ratings agency downgraded Russia's credit rating to Baa2 from Baa1, naming the Ukrainian crisis and the western economic sanctions among the main drivers for the downgrade.
"The first driver for the downgrade ...relates to the longer term damage the already weak Russian economy is likely to incur as a result of the ongoing crisis in Ukraine and, relatedly, the additional sanctions imposed against Russia," the agency said on Saturday, as quoted by AFP. Moody's added that it was maintaining Russia's outlook as "negative".
In June Moody's assigned negative outlook to Russia's government bond rating, stating that the decision was triggered by the rise in Russia's susceptibility to geopolitical event risk and a deterioration of the country's medium-term economic growth outlook.
The West has been introducing sanctions against Russia over its alleged role in escalating the Ukrainian crisis, although Moscow has repeatedly denied these claims. The sanctions at first targeted certain individuals but later spread onto whole sectors of the Russian economy, targeting Russian largest energy and defense companies, as well as financial institutions.
Russia responded to the sanctions with a ban on food imports from the United States, the European Union, Canada, Australia and Norway.
Amid the western restrictions Russia has increased its trade and technology cooperation with Latin America, BRICS and Asia-Pacific.