Reduction in Moody’s rating of Russia to “junk status” plays against the West

International rating agency Moody's Investors Service has downgraded rating of government bonds of Russia to speculative grade Ba1 from Baa3. The rating outlook is "negative". Moody's calls the main reasons for downgrade the consequences of the Ukrainian crisis, falling oil prices and the depreciation of the ruble. The agency predicts that this year a recession will take place in the Russian economy, the decline will continue also in 2016.

Expectations of Moody's, to say the least, are impressive. The agency predicts an outflow of capital from Russia in the amount of $272 billion in 2015, the decline in GDP by 8.5% over the next two years and inflation above 22% in the current year.