S&P raises Ukraine ratings, outlook stable

S&P raises Ukraine ratings, outlook stable

S&P Global Ratings raised its global scale long-term foreign and local currency sovereign ratings on Ukraine to 'B' from 'B-', the outlook is stable.

"On September 27, 2019, S&P Global Ratings raised its global scale long-term foreign and local currency sovereign ratings on Ukraine to 'B' from 'B-' and its Ukraine national scale ratings to 'uaA' from 'uaBBB'. The agency also affirmed the short-term ratings at 'B'. The outlook is stable," the Government portal reports.

The Cabinet of Ministers of Ukraine notes that stable outlook reflects the agency’s expectation that Ukraine's new government will preserve the macroeconomic reforms of recent years while the economy recovers and general government debt relative to GDP declines. “As a result, Ukraine should retain access to domestic and international capital markets, allowing it to meet commercial debt repayments through 2020,” the statement reads.

The analysts of Standard & Poor's view positively the new government's intention to improve the business environment and lift the moratorium on the sale of agricultural land. In their opinion, these measures could pave the way for higher foreign investment inflows into Ukraine, boding well for the economy's growth and external leverage.

The agency also could consider a positive rating action if it sees improvements in growth, fiscal, and external metrics beyond its expectations. “We could also consider raising the ratings if inflation converges toward the NBU's target, or if credit growth in real terms picks up and capital controls are lifted,” the S&P’s statement reads.


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