The Moody's ratings agency has raised the outlook on Russian government debt, citing improved fiscal management that it says will reduce the government's dependence on oil and gas revenues.

Despite raising the outlook to "stable" from "negative" for the first time since April 2016, Moody's maintained its Ba1 rating on the debt, leaving it in the "junk" category.

Moody's said on February 17 that the main driver for the improved outlook "is the government's enactment of a medium-term fiscal-consolidation strategy that is expected both to lower the government's dependence on oil and gas revenues and to permit the gradual replenishment of its savings buffers."

Moody's said the downside risks to the economy the agency saw last year had eased, allowing the improved debt outlook.

The Russian economy is recovering after a nearly two-year-long recession, it said.

Economists say stable oil prices have helped boost the Russian economy despite sanctions placed on it by the United States and European Union for Moscow's illegal 2014 annexation of Ukraine's Crimea region and its support for separatists in eastern Ukraine.

Based on reporting by Barron’s and TASS