Moody’s downgrades Ukraine one notch from default

By Le Figaro with AFP

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This degradation “is motivated by the effects of the war with Russia which are likely to cause lasting difficulties for the economy and public finances of Ukraine”detailed the agency. STRINGER / REUTERS

Rating agency Moody’s on Friday (February 10th) downgraded Ukraine’s rating to Ca, the last notch before default, due to the long-term effects of Russia’s war.

This rating downgrade “is motivated by the effects of the war with Russia which are likely to cause lasting difficulties for the economy and public finances of Ukraine”detailed the agency in a press release. “These difficulties increase the risks for the sustainability of public debt, making a debt restructuring very likely with significant losses for private sector creditors”added Moody’s.

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Perspective stable

The rating agency, however, raised the outlook from negative to stable, signaling that it does not envisage in the short term, either to downgrade the rating once more, or to raise it. “The stable outlook reflects balanced risks (…), which is consistent with recovery in the event of default typically in the range of 35-65%”said Moody’s.

Russia invaded Ukraine nearly a year ago on February 24, 2022.

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