Russia narrowly avoided a debt default last week, but markets are still priced like it’s on the brink.
Bonds are stuck at distressed levels and five-year credit default swaps put an 87% chance of a default. Those odds are lower than in April, but still elevated.
The reason? The trend of international governments toward tougher sanctions and more widespread restrictions is keeping investors in the dark about the likelihood of them getting their hands on the future payments they’re owed. Even if Moscow keeps pushing to get money through the labyrinth of rules, success is far from guaranteed.
