Farewell to stabilityon March, 11th the international rating agency Standard and Poor ` s (S &P) has changed the forecast on long-term sovereign ratings of Russia with “ stable “ on “ positive “. Though the rating remains at level VVV +, before hit of Russia in a treasured investment category And already a half-step. The domestic stock market has reacted to decision S &P growth on 2,3 % on RTS index. Stably high prices for oil, and also the politician of the largest world Central Banks are capable to fix this positive trend.
a half-step to happiness
Last time sovereign ratings of Russia were overestimated half a year back: on August, 16th, 2007 agency Fitch, and on August, 21st agency S &P have confirmed the forecast “ stable “ having left a rating at level VVV +. Contrary to expectations agency Moody ` s has not raised then a sovereign rating of Russia, having kept it at level of Vaa2.
According to conservatives from Moody ` s, the investment rating of the Russian Federation remains invariable since October, 25th, 2005 when it has been raised with Vaa3 to Vaa2. Other international agencies were more generous and for last three years repeatedly raised a sovereign rating of Russia. So, Fitch on July, 25th, 2006 has raised a rating with VVV to VVV +. And S &P for three years improved an estimation of Russia twice: on December, 25th, 2005 with VVV - to VVV, and on September, 4th, 2006 - with VVV to VVV +.
New increase of forecast S &P means that to a treasured category And Russia remains a half-step. “ forecast revision reflects our expectations of the further growth of budgetary and external reserves of the country which already and are at present considerable enough. Huge stocks of liquidity in the foreign currency, accumulated by the Russian government, even after reduction of reserves on $147 mlrd (gross) external obligations of bank system will provide a covering with reserves of payments under the account of current operations for the period, equivalent to nine months that three times it is more mediannogo than an indicator for the countries with ratings of a category And “ - are resulted in a press - release of agency of a word of its credit analyst of Frenka Gilla.
However, has not managed and without a tar spoon. “ the long-term forecast can be again reconsidered on “ stable “ if a policy of accumulation of reserves in special budgetary funds or planned changes of political structures will not be realised “ - warns Gill.
Reaction of the Russian officials to increase of a sovereign rating was positive. “ The investment rating of the international rating agency reflects appeal of investment to Russia, allows us on more favourable conditions to involve the investment and credits, and it reflects those positive changes which occur in the Russian economy “ - has declared on March, 12th on a press - conferences the Minister of economic development and trade of Russia Elvira Nabiullina. And the director of department of an external debt of the Ministry of Finance Konstantin Vyshkovsky, answering a question on reception terms Russia the international rating of a category And, predicted: “ I hope that within a year it is quite possible “.
forecast change on a sovereign rating of the Russian Federation renders Direct influence only on profitableness of the Russian eurobonds: it decreases. However the long-term investment effect much more seriously also influences economy as a whole.
Hit of Russia in the list of the countries with an investment rating And is capable not only to involve means of conservative investors, but also to lower their cost. And that and another can occur quickly enough. It has confirmed “ to Money “ the deputy director of service of ratings of regional and local authorities S &P Felix Ejgel: “ the Time horizon of the forecast makes from six months till two years. Nevertheless the forecast, as well as a rating, can be changed at any moment in case of essential change of the factors defining level of credit status of the borrower. Interest rates depend not only on credit quality of the borrower, but also from market factors, such, as liquidity. Nevertheless investors consider credit ratings at an estimation of risk of investment in promissory notes of the borrower. With other things being equal at increase of a credit rating interest rates under promissory notes of the borrower can decrease “.
Decrease in rates concerns not only sovereign loans, but also corporate. Especially debts of those corporations where the state share is considerable. And after all they should return in 2008 more than $20 mlrd, involved on the world market. Difficulties with refinancing of these debts repeatedly caused concern of representatives of the Russian financial authorities. refinansirovatsja after decision S &P it will be a bit easier.
the Russian stock market has reacted to increase of a sovereign rating by growth. To an exit of positive news on March, 11th RTS index has had time to fall to 1,4 %, however following the results of trading session has fixed growth on 2,3 %. The next day has brought to an index of RTS of 1,03 more % of growth - to 2080 points.
we Will notice that growth of the market besides decision S &P was promoted also by other positive factors. Main - stably high world prices for oil. So, for first three months 2008 the price of oil of mark Urals has grown on 9,7 %, having reached $104,15 for barrel. It renders support to the Russian market, however to say that investors have already won back the high prices for oil, meanwhile it is not necessary. Sales which were automatically threw on our market in the beginning of year from world platforms, have not allowed while to the Russian market to show results adequate to an oil fever.
another matter that the negative external background which constrained the Russian market more half a year, is even more often diluted with positive messages from - for a boundary. To that became, for example, the decision of the largest world Central Banks led by FRS to expand crediting of national bank systems. That $250 billion will pour out in granting of additional liquidity to the financial markets for a total sum almost After that decisions leading exchange indexes have grown on 0,8 - 1,5 %.
the Internal positive factor is possible decrease in the VAT (see " more in detail; Money “ N7 for 2008). In this connection too there were pleasant news for investors. On March, 11th, after a meeting of president Vladimir Putin with the State Duma management, the speaker of the Russian parliament Boris Gryzlov has initiated - to enter the uniform rate of the VAT at level of 10 %.
Thus, the combination of an external and internal positive restores the optimism of players of the Russian market lost as a result of world financial crisis. Revision of estimations of cost of papers, truth, yet has not begun - except for those companies which incomes are adhered to the prices for oil. However and without that, according to the majority of analytical forecasts, target value of an index of RTS on the end of the year is in area of 3000 points. Still recently achievement of these boundaries could be perceived as a utopia. But after decision S &P these figures are represented more well-founded. At least, to reconsider them towards decrease the overwhelming majority of participants of the market does not gather.