Moody's downgrades Ukraine

Moody's Investors Service said it downgraded Ukraine's foreign- and domestic-currency long-term issuer ratings and foreign-currency senior unsecured debt ratings to Ca from Caa3 and changed the outlook to stable from negative.

The downgrade is driven by the damage caused by the war with Russia, likely to present long-term challenges to Ukraine's economy and public finances. “These challenges increase risks to government debt sustainability, making a debt restructuring with significant losses for private-sector creditors very likely,” Moody’s said in a statement.

The agency said the revised outlook indicates the risks at the Ca level. Creditors can expect to recover 35%-65% if Ukraine defaults.

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