September 23, 2018

Russia’s junk credit rating down to incompetence of American rating agencies

© Alexey Druzginin / Anton Denisov / Russian Presidential Press OfficeFitch upgrades Russia’s credit rating from stable to positive

RT talked to investing guru and financial commentator Jim Rogers who said the American rating agencies are incompetent and have “made a lot mistakes in the past decades.”

“They’ve been so wrong so many times in the past. They are totally incompetent; they don’t know what they are doing,” said Rogers.

According to the investor, Russia’s ratings will continue to go higher as it has very low debt compared with most countries in the world and its economy is getting better.

“We have seen some people starting to invest in Russia again. This is just the continuation of the same process. It is happening, more will happen, but it will not be so fast,” said Rogers.

He added that he doesn’t expect the SP and Moody’s to follow Fitch by raising Russia’s ratings.

“I wouldn’t think it could be soon. They have a lot of geopolitical pressure than they admit and most people realize,” Rogers said, making an example of the United States with its AAA rating (the highest possible) despite the country’s huge debt.

Russian Economic Development Minister Maksim Oreshkim said on Monday a rise in Russia’s ratings by the international agencies is inevitable. Financial markets have long assessed the country’s rating higher than the agencies, he said, explaining that Moody’s and SP were paused on hold because it’s difficult for them to admit mistakes.

“Taking into account our achievements in macroeconomic policy and the restoration of economic growth, the improvement of ratings is simply inevitable, and they [SP and Moody’s –Ed.] are waiting for a proper moment when it could be the least painful for their own reputation,” Oreshkin said.

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