Kremlin says debt default theoretically possible but there are no grounds for real default

Russia could in theory find itself in default but this would be an artificial situation, the Kremlin said on Wednesday, after the finance ministry decided to make payments on its two sovereign Eurobonds in roubles.

There are no grounds for a real default, Kremlin spokesman Dmitry Peskov said, adding that Russia has all necessary funds to service its obligations but will continue to repay its external debt in roubles while its foreign exchange reserves remain blocked by Western sanctions.