Moody’s increased the credit rating of Ukraine

The Agency raised the sovereign rating of the country.

Moody’s raised the rating to Caa2 from Caa3 to nine editions of sovereign Eurobonds of Ukraine, was issued in November 2015 as part of the restructuring of the national debt. In addition, the Agency improved the Outlook from stable to positive, according to an official statement.

Change rating Moody’s explained the impact of structural reforms in Ukraine, which should improve the situation with the public debt, and a strengthening external position of Ukraine.

The Agency expects profit primary balance of the state budget of Ukraine (debt payments) in the next few years will be at around 1% of GDP, “which would correspond to the reduction of the public debt trajectory in the absence of a further significant weakening of the exchange rate”. However, Moody’s forecasts that the deficit will be nearly 3% of GDP.

The main challenge for Ukraine Moody’s calls the increase in debt payments of the government from 2019, actualizes the question of refinancing of external obligations.

According to experts of Agency, the level of external vulnerability, Ukraine is still high, but it is more manageable than in 2015 (due to the growth of foreign exchange reserves from $ 5 billion to $ 15 billion).

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