MOSCOW, December 12 (RIA Novosti) - Moody's Investor Service lowered Russia's rating outlook from positive to stable, the agency said on Friday.
Moody's was the last of three major rating agencies to issue Russia with a negative rating following Fitch and Standard & Poor's, who cut Russia's long-term debt rating for the first time in a decade this week to the second-lowest investment-grade rating of BBB.
Russia's ruble had its biggest weekly decline against the euro since 2000 after the central bank eased its defense of the currency for the fifth time in a month foreign currency reserves fell.
The ruble dropped 3.3% this week to 37.0395 per euro and was 0.2% lower today as of 12:54 p.m. Moscow time.
The decrease in Moody's rating is down to falling currency reserves and decelerating economic growth, as well as the threat of a budget deficit over plunging commodity prices.
And as if to echo the gloomy outlook a deputy economics minister said on Friday that an economic recession had begun in Russia with GDP growth expected to fall below the 6.8% forecast this year.
"A recession has started," Andrei Klepach said. "We will face two quarters [of economic decline]."
The stable rating, nonetheless, portrays Russia's firm credit position, and shows that Russia is holding a favorable position compared with other countries that are also in the Baa rating. Russia presently holds a Baa1 rating.
