Ukraine's Financial Crisis Deepens as Fitch Downgrades Credit Rating

Fitch has downgraded Ukraine's credit rating from 'CC' to 'C', signifying that a default or default-like scenario has commenced. This follows an agreement to restructure $20 billion in international bonds, reducing payments by $11.4 billion over three years. The downgrade reflects Ukraine's dire financial situation amid its prolonged conflict with Russia.

Fitch has further downgraded Ukraine's credit rating, pushing it deeper into default territory with a 'C' rating. This move follows a freshly inked agreement with a group of creditors to restructure $20 billion in international bonds.

The 'C' rating indicates that Fitch believes Ukraine is now in a default or default-like process. On Monday, Ukraine announced it had reached an agreement to restructure its bonds, bringing the country closer to a significant debt overhaul amidst ongoing conflict.

The restructuring plan includes a 37% nominal reduction on Ukraine's international bonds, saving the nation $11.4 billion in payments over the next three years. Fitch classified this agreement as a distressed debt exchange, involving major changes to terms and extended maturities.

Ukraine's economic condition remains fragile due to its prolonged war with Russia. The 2022 invasion by Russia severely crippled Ukraine's economy, forcing it to rely heavily on foreign financial and military assistance.

(With inputs from agencies.)