KYIV, July 25 - Fitch Ratings has downgraded Ukraine's Long-Term Foreign-Currency (LTFC) Issuer Default Rating (IDR) to 'C' from 'CCC', the rating agency said on its website.

"Fitch typically does not assign outlooks to sovereigns with a rating of 'CCC+' or below. Fitch has removed all of the ratings from Under Criteria Observation (UCO)," it said.

"On July 20, the Ukrainian government formally launched a consent solicitation to defer external debt repayments for 24 months. Fitch views this as the initiation of a distressed debt exchange (DDE) process, consistent with ratings of 'C' for both the LTFC IDR and affected securities. According to Fitch's Sovereign Criteria, a commercial debt restructuring that entails a material reduction in terms, such as the deferral of interest or principal, and is necessary to avoid a traditional payment default constitutes a DDE. The LTFC IDR would be downgraded to 'RD' (restricted default) and the affected instruments to 'D' following the consent solicitation "effective date" should it be accepted, which we view as likely," it said.