The Fitch Ratings International Rating Agency has confirmed the long -term rating of the Issuer (RDE) default rating of Ukraine in foreign currency at the SS level, which indicates a high probability of default. The agency also confirmed the ratings of the issuer's default in national currency at the level of "CCC-". These ratings reflect the expectations of further restructuring of Ukraine's commercial debt before the moratorium on payments on Eurobonds on September 1, 2024.
Restructuring is expected to relate to foreign currency debt, but national currency debt is excluded from this process. The national currency rating reflects a significant credit risk on long -term debt, caused by uncertainty about sources of financing due to a high budget deficit.
Fitch also expressed expectations that Russia's war against Ukraine will continue in the current scale during 2024. The growth of Ukraine's GDP in 2023 is projected by 5.1% after a significant fall in 2022. Inflation and high budget deficit are also expected over the coming years.
This Fitch decision emphasizes the complex economic conditions caused by military conflict and the need for debt restructuring to overcome Ukraine's financial difficulties.
