Credit rating downgrade indicates Russia heading for historic default

A currency exchange screen displays exchange rates in Moscow in February (Pavel Golovkin/AP)

The credit ratings agency Standard & Poor’s has downgraded its assessment of Russia’s ability to repay foreign debt, signalling rising prospects that Moscow will soon default on external loans for the first time in more than a century.

S&P Global Ratings issued the downgrade to “selective default” late Friday, after Russia arranged to make foreign bond payments in roubles on Monday when they were due in dollars.