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Russia Dodges Default for Now as Investors Get Dollar Funds

  • Government is dipping into dollars held locally to move funds
  • Western sanctions have complicated sovereign bond transfers
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WATCH: As Russia races to avoid a default at least one international clearinghouse has reportedly received and processed payments for eurobonds due in 2022 and 2042.Source: Bloomberg
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Russia’s closely watched dollar payments on two bonds are trickling through to investors after the country dipped into its local holdings of the U.S. currency and sidestepped its first foreign default in a century.

The transfer of the $650 million had got tangled up in the wide-ranging sanctions imposed after the invasion of Ukraine. And despite the 11th-hour escape before a Wednesday deadline to get the funds to creditors, Russia could face bigger hurdles within weeks that scupper future payments.