News

#: Russia debt default would not be a ‘systemic risk’ to global economy, top IMF official says

Table of Contents

“: Russia debt default would not be a ‘systemic risk’ to global economy, top IMF official says”

A Russian default on its sovereign debt would not have a large impact on the global economy, said Gita Gopinath, the No. 2 official at the International Monetary Fund, on Tuesday.

“If there were a default, I think the direct effect on the rest of the world would be quite limited,” Gopinath said, in a virtual discussion hosted by Foreign Policy magazine.

“The numbers that we’re looking at are relatively small from a global perspective. It is not a systemic risk to the global economy,” she added.

Some individual banks will have greater exposure to Russia debt, she noted.

From Russia’s perspective, a default would have consequences for the long term, Gopinath said.

“When you’ve defaulted, reentry into the market is not easy. And that can take a long time,” she said.

Earlier this month, Russia made payments to avoid default.

Sanctions put on Russia after the country invaded Ukraine don’t prohibit debt payments.

Greg Robb

If you liked the article, do not forget to share it with your friends. Follow us on Google News too, click on the star and choose us from your favorites.