Nov 14 (Reuters) – Global ratings agency Fitch affirmed Ukraine’s long-term foreign currency sovereign credit rating at “restricted default” on Friday, saying it would remain unchanged until the country normalizes relations with most external commercial creditors.<\/p>\n
As Ukraine’s war with Russia nears its fourth year, the prolonged conflict continues to strain the economy, pushing defense<\/a> spending to about 2.96 trillion hryvnias ($70.86 billion) this year.<\/p>\n Sign up here.<\/a><\/p>\n Talks between Ukraine and holders of its GDP warrants collapsed for a second time in six months earlier in November, further delaying efforts to restructure the $3.2 billion in bond-like instruments. The country’s central bank also cut its 2025 GDP growth forecast.<\/p>\n “Spending pressures will remain heavy even after the end of the war, with Ukraine likely to retain a large military force,” Fitch said.<\/p>\n Ukraine is in talks with the International Monetary Fund for a new four-year lending program to replace its existing $15.5 billion arrangement, of which it has already received $10.6 billion.<\/p>\n The country is seeking a new IMF program because the one agreed in 2023 assumed the war would end by late 2025, a prospect that remains distant.<\/p>\n “Ukraine will remain reliant on external funding sources to cover its sizeable funding needs over the medium term,” Fitch said.<\/p>\n The agency typically does not assign outlooks to sovereigns with a rating of “CCC+” or below.<\/p>\n ($1 = 41.7754 hryvnias)<\/p>\n Reporting by DhanushVignesh Babu and Sri Hari N S in Bengaluru; Editing by Shilpi Majumdar<\/p>\n Our Standards: The Thomson Reuters Trust Principles., opens new tab<\/a><\/p>\n