Russia has effectively defaulted on its foreign debt by offering bondholders to pay in rubles instead of dollars. Reported by CNN with reference to S&P.

According to the rating agency, the Russian Federation tried to pay the two-dollar bonds in rubles that expired on April 4. S&P said the decision was tantamount to a “selective default.”

Russia has a grace period of 30 days to meet its obligations. Despite this, on April 9, S&P downgraded the long-term and short-term rating of the Russian Federation. SD.

“[…] We do not expect investors to convert their ruble payments to their original dollar equivalent or the government to convert these payments during the grace period,” the agency said in a press release.

The information was confirmed to CNN by John Cooper, a member of the US presidential administration.

On April 11, Russian Finance Minister Anton Siluanov announced in an interview with Izvestia that he is ready to go to court in case of default.

Russia does not have access to approximately $300 billion in foreign exchange reserves due to Western sanctions imposed after the military invasion of Ukraine. A significant part of the funds remaining in the Russian Federation is presented in the vaults in the form of low liquid gold.

Recall that in April, the United States suspended more than $ 600 million from reserves held in American correspondent banks to Russian bonds in dollars.

Previously, Russia could pay off its national debt using funds in its accounts at American financial institutions, including JPMorgan. But on April 4, the US Treasury decided to rule out this possibility as part of tightening sanctions.