S&P Global Ratings revised Russia's foreign currency long- and short-term sovereign credit ratings to BBB-/A-3 from BB+/B, while keeping the outlook stable. It also upgraded the sovereign's credit ratings to BBB/A-2 from BBB-/A-3.

The rating agency said the upgrade reflects Russia's prudent policy changes which have helped its economy adjust to international sanctions and falling commodity prices.

In addition, the move reflects a reduction in medium-term risks of fiscal slippage on the back of an enhanced fiscal policy and the country's dedicated fiscal restraint. And measures taken by the Central Bank of the Russian Federation preserved financial stability despite the ongoing cleanup of Russia's banking system, according to the rating agency.

The ratings have also been affected by Russia's conservative macroeconomic management, low government debt, strong net external asset position and relatively high monetary flexibility, which includes the flexible exchange rate regime.

The rating agency noted that the country's economic growth has improved and expects it to continue through 2021 with real GDP growth rising to 1.8% in 2018 and 1.7% on average over the 2019-2021 period.

In addition, S&P expects Russia's current account balance to remain in surplus at nearly 2% of its GDP on average over the next three to four years. The rating agency expects this performance to continue based on its recently revised oil price assumption for 2018 to $60 per barrel from $55 per barrel.

S&P notes that the ratings are constrained by its assessment of Russia's economy, regulatory weaknesses and geopolitical tensions which have led to international sanctions.

Fitch Ratings affirmed Russia's long-term foreign- and local-currency issuer default ratings at BBB with a positive outlook on the basis of the country's prudent fiscal strategy, improving economic policy framework and strong external finances.

S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.