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Fitch affirmed Ukraine's IDRs at 'CCC'

Fitch  affirmed Ukraine's IDRs at 'CCC'Fitch Ratings has affirmed Ukraine's Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) at 'CCC'. The issue ratings on Ukraine's senior unsecured foreign and local currency bonds have also been affirmed at 'CCC.'

Fitch said in its press release that the Country Ceiling has been affirmed at 'CCC' and the Short-term foreign-currency IDR at 'C'.

According to the document, the affirmation of the ratings reflects a lack of progress on the reform programme needed to unlock donor support, which has been exacerbated by political wrangling.

Read also: Fitch withdrew Ukrzaliznytsia's ratings

Fitch expects the new government to move ahead with the reforms required to secure the delayed IMF tranche ($1.7 billion), now likely in early Q3 2016. However, given the coalition's narrow majority (one seat) as well as weak party discipline within President Poroshenko's party, Fitch expects progress on further reforms to be piecemeal with continued delays in IMF financing highly probable.

Fitch said that failure to secure all planned disbursements would not undermine Ukraine's capacity to meet its external debt repayment obligations over the rating horizon, but would exert continued downward pressure on the hryvnia and jeopardise the recovery.
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