Credit rating agencies Fitch and S&P downgraded Ukraine’s long-term credit rating. Fitch lowered its ratings from B to CCC and S&P from B to B-. Both rating agencies said the invasion of Ukraine poses a risk to economic growth, financial stability, the country’s external situation and public finances.
Fitch also noted the risk of Ukraine not being able to repay its debts after the Russian invasion. The evaluator also notes in one of the letters “the uncertainty about the extent of Russia’s ultimate goals, the duration, size, intensity and consequences of the conflict.”
Standard & Poor’s also indicates a negative outlook, which means that the rating could be lowered further “if the numerous uncertainties associated with the military conflict significantly impair Ukraine’s external liquidity, financial system or administrative capacity”.
S&P also lowered Russia’s foreign exchange rating from BB+ to BBB-. “We believe that the announced sanctions could have significant direct and indirect effects on external economic and trade activities, public confidence and financial stability. We also expect geopolitical tensions to erode confidence in the private sector, which will have an impact on growth,” he added.