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Russia reopens bond market to ‘not hostile’ investors

Russia reopens bond market to ‘not hostile’ investors

After a nearly six-month halt during the Ukraine crisis, the Moscow Exchange will partially return to international investors on Monday.

Only investors from “countries that are not hostile” would be permitted to trade bonds, according to the statement.

Many of Russia’s biggest investors are now excluded since they put economic sanctions on that country.

In February, Russia closed its markets to prevent money from fleeing the nation while the war was ongoing.

The Moscow Exchange said that it will once again allow non-resident clients from friendly nations and non-residents whose ultimate beneficiaries are Russian legal entities or people to trade bonds.

Given that they have not implemented sanctions against Russia, China and Turkey are most likely included in this group.

Banks, brokers, and investment management firms have begun to register their overseas clients with the exchange, it was further said.

On February 24, hours after President Vladimir Putin launched tens of thousands of troops into Ukraine, Russia halted its stock and bond markets.

It started a gradual reopening in March that was just for Russian government-issued bonds.

Investors from “unfriendly” nations, who continue to be prohibited from selling Russian equities, are not included in the trading that resumed on Monday.

Members of the European Union, Canada, and Japan are among these nations. Ninety percent of the money invested in Russia last year came from this group.

Russia’s economy has suffered as a result of the invasion of Ukraine and the sanctions imposed by Western nations.

The nation is thought to have had its first debt default since 1998 in June.

Although it had the money to send an overseas creditor a $100 million (£82.5 million) payment, sanctions prevented it from doing so.

Dmitry Peskov, a spokesman for the Kremlin, said that the reserves had been “illegally” frozen and that an intermediate bank had kept the funds.