What has happened to the Russia debt repayment? They were expected to default on debt during the current week?

The good news is that Russia did not default on the debt payment during the week. In fact, on Friday, which was a trading holiday in India, Russia actually made coupon payments due on two of its sovereign bonds denominated in US dollars during the week. There were fears that the Western sanctions may have pushed Russia finances into a corner and they may be forced to default. Fortunately, that did not happen.

The total pay-out on account of coupons on Friday was $117 million, but Russia has confirmed that the amount was paid on Thursday itself. The sanctions on Russia have been active since they attacked Ukraine and extent to trade and also to their participation in the SWIFT system. However, despite the sanctions, the Western governments allowed the use of frozen funds abroad for coupon payments to avoid a payment crisis in the global markets.

There was a widespread fear that Russia may default on its debt payment and this would have been their first default since the rouble crash in 1998. Since the coupons were dollar denominated, the West had no choice but to permit the use of frozen funds. In fact, the stock markets globally got a boost after they realized that Russia had not defaulted. In 1998, when Russia defaulted, it had caused the bankruptcy of LTCM.