The fall in the ruble has led to a sharp increase in the foreign currency debt burden for Russian companies. The risks are mitigated to some extent by the fact that the debt is concentrated among large public companies which, given their importance, are back-stopped by the government’s sizeable foreign exchange reserves. Even so, at the very least, continued deleveraging by these companies will weigh on investment and ensure that the economic recovery – as and when it does come – will be weak.
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