However, it was recently reported that MSCI (NYSE: MSCI), another major index provider to ETF issuers, is mulling the removal of Russian stocks from its MSCI Emerging Markets Index, one of the most widely followed benchmark’s of emerging markets equities in the world.
Last week, in an effort stem ruble declines, Russia’s Central bank boosted its benchmark interest rate to 17% from 10.5%. The rate hike was the second since the previous Thursday and in the span of less than a week Russian borrowing costs more than doubled from 8%. The drastic move by Russia’s central bank spurred speculation it was not done moving to save the flailing ruble and that future moves could include capital controls.
It won’t be long before investors know the results of S&P CreditWatch placement of Russian debt as the ratings agency expect to resolve that placement by mid-January.
Bond ETFs with exposure to Russian debt include the ProShares Short Term USD Emerging Market Bond ETF (BATS: EMSH) and the Vanguard Emerging Markets Government Bond ETF (NasdaqGM: VWOB).
Market Vectors Russia ETF
