Economics
Moody’s Downgrades Ukraine as Drawn Out War Raises Debt Risk
- Company cut Ukraine’s rating to Caa3, third-lowest level
- Rise in debt likely unsustainable in the medium term: Moody’s
Ukrainian service members operate a tank at a front line position near the city of Lysychansk, eastern Ukraine, on May 20.
Photographer: Aris Messinis/AFP/Getty ImagesThis article is for subscribers only.
Moody’s Investors Service cut Ukraine’s credit rating to the third-lowest level as a more drawn out war than expected increases risks around the nation’s debt sustainability.
The agency downgraded Ukraine by a notch to Caa3, now rating it on par with serial defaulters like Ecuador and Belize. At the Caa3 rating level, Moody’s expects a recovery in the event of default of typically between 65% to 80%, according to a statement published Friday.