Russia's Debt Just Got Costlier to Insure Than South Africa's

(Bloomberg) -- Russia’s credit risk jumped above South Africa’s for the first time in more than 18 months.

The cost of insuring Russian debt against non-payment, as measured by five-year credit default swaps, has climbed 40 basis points this week to 162 as the stand-off with the U.S. over Syria intensifies. South Africa’s has risen 8 basis points to 160.

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Cristian Maggio, head of emerging markets strategy at TD Securities in London, says Russia’s relations with the U.S. have reached a new low.

“Concern that this situation may worsen further and cause lasting consequences is what’s driving the market at the moment,” he said.

Russia’s debt is rated BBB- at S&P Global Ratings, the lowest investment level and one step above South Africa’s.

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