S&P says Russian debt default is more likely

S&P Global Ratings has downgraded its assessment of Russia's ability to repay foreign debt, signalling increased prospects that Moscow will soon default on such loans for the first time in more than a century.

The credit ratings agency issued the downgrade to “selective default” Friday night after Russia arranged to make foreign bond payments in rubles last week when they were due in dollars. It said it didn't expect Russia to be able to convert the rubles into dollars within a 30-day grace period.

S&P said it believes sanctions on Russia over its invasion of Ukraine are likely to increase, impeding its willingness and ability to honour its obligations to foreign debtholders.

The Kremlin has signalled it's willing to pay its debts but warned it would do so in rubles if its overseas accounts in foreign currencies remain frozen.