S&P downgrades Ukraine

Standard & Poor's said it lowered its long-term foreign currency sovereign credit rating on Ukraine to CCC- from CCC and its long- and short-term local currency ratings to CCC+/C from B-/B.

The foreign currency short-term sovereign credit rating was affirmed at C.

The outlook is negative.

The agency also lowered the Ukraine national scale rating to uaB+.

S&P said it previously anticipated that IMF disbursements would be paid to Ukraine in 2014, but these have been delayed. In the agency’s view, this delay, coupled with significantly reduced foreign currency official reserves, increases the risk that the Ukrainian government might not be able to meet its obligations.

A default could become inevitable in the next few months if circumstances do not change, for instance if additional international financial support is not forthcoming, S&P said.

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