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June 27, 2022 6:33 am ET
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A general view of the Kremlin, Red Square and St. Basil’s Cathedral in central Moscow. AFP via Getty Images
Russia’s first default on its foreign debt in more than 100 years is the latest sign that the sanctions levied against the country after the Ukraine invasion have consequences. But it’s probably not that important.
To be sure, Russia’s default on ruble-denominated bonds in 1998 was a big deal. It forced highly leveraged hedge fund Long Term Capital Management to collapse, a precursor of the financial crisis that struck a decade later. It’s possible that there are some other institutions that will get into trouble now, and it may take a little while for them to emerge.
The Russian Default Is Less Worrisome Than It Appears. Keep Watching Oil.
Russia’s first default on its foreign debt in more than 100 years is the latest sign that the sanctions levied against the country after the Ukraine invasion have consequences.
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