Publish date20 Dec 2014 - 11:36
Story Code : 177040

S&P lowers Ukraine credit rating to CCC-

Standard & Poor’s (S&P) ratings agency has downgraded the credit rating for Ukraine to CCC- with a negative outlook, warning the country against its melting foreign currency reserves.
S&P lowers Ukraine credit rating to CCC-


In a report released on Friday, S&P slashed Ukraine’s long-term sovereign rating one level to CCC-, nine steps below investment grade.

“The negative outlook reflects our view of the increasing risk that, without additional financial support, Ukraine may default on its obligations,” S&P analysts said in a statement.

The US-based credit rating agency said a delay in the 2014 aid by the International Monetary Fund (IMF) coupled with “significantly reduced foreign currency official reserves, increases the risk that the Ukrainian government might not be able to meet its obligations.”

Ukraine estimates that its gross domestic product (GDP) will contract seven percent this year, while its foreign reserves currently stand at the lowest level in more than a decade.

The government in Kiev has called for international aid to rescue it from the economic crisis it is facing, but Western creditors want tough reforms to give the necessary funds to Ukraine.

The European Union says Ukraine requires USD 15 billion on top of a USD 17 billion international bailout to stay afloat amid the chaotic situation in the country’s east, which has witnessed deadly clashes between pro-Russia forces and the army since mid-April.

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