Fitch downgrades Ukraine’s rating to restricted default level

The credit rating agency Fitch Ratings has downgraded Ukraine’s rating from “C” to “RD” (Restricted Default). This decision is linked to the expiration of a 10-day grace period for a $750 million Eurobond payment.

This information appeared on the agency’s website.

Fitch has also downgraded the rating on these Eurobonds to “D,” while the ratings for other Eurobonds remain at “C.”

It is important to note that this downgrade follows a new agreement with Eurobond holders in July regarding the restructuring of Ukraine’s external debt. The agreement includes a nominal discount of 37% on Ukraine’s outstanding international bonds, which will allow Kyiv to save $11.4 billion in payments over the next three years.

Earlier, media reports indicated that Ukraine has the largest budget deficit in the world due to the ongoing war, with the country’s expenses being twice as high as its revenues. This year, the $40 billion deficit is being covered by Western partners. However, the situation for the next year is “much worse,” prompting Kyiv to request continued support from its partners.