Bonds, Frontier Markets

Barclays Cuts Russian Government Bonds From Indices Following Junk Downgrade

Photo Courtesy of Reuters/Kacper Pempel

Photo Courtesy of Reuters/Kacper Pempel

Foreign currency debt issued by the Russian government will be cut from British bank Barclays’ global bond indices following Moody’s downgrade it to junk, Reuters reports.

Exclusion from an index puts securities off limits for many asset managers and can lead to heavy selling as investors drop the stocks or bonds that have been pushed outside their remit.

In a note released late on Monday, the bank said that it was removing the ten U.S. dollar-denominated and one euro-denominated bonds from the Barclays’ Global Aggregate Indices at the end of February when it reshuffles its indices.

This so-called ‘hard currency’ debt will no longer be eligible for the Investment Grade Global and Euro Aggregate but local currency Rouble-denominated bonds will continue to be eligible for the Global Aggregate Indices.


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