S&P cuts Belarus

Standard & Poor's said that it lowered the long-term foreign-currency ratings on the Belarus to B from B+ and its long-term local-currency ratings to B+ from BB.

The short-term local- and foreign-currency ratings were affirmed at B.

The outlook on the long-term ratings is negative.

The recovery rating on Belarus' senior debt is unchanged at 4, indicating the expectation of a 30%-50% recovery of principal in the event of a default.

The rating actions reflect the country's heightened vulnerability to negative external financing trends because of the deterioration in usable reserves, S&P said.

The negative outlook reflects the likelihood of a downgrade if the country's external financing plans are impaired by a material increase in interest rates or by unanticipated impediments to securing external funding, the agency added.

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