Fitch Ratings has downgraded Sri Lanka's long-term foreign-currency issuer default rating, citing political upheaval that has resulted in the country having no functional government, the International New York Times reported on an Associated Press story. Fitch says it lowered the country's rating to B from B plus with a stable outlook, reflecting heightened external financing risks, uncertain policy outlook and a slowdown in fiscal consolidation.
Sri Lanka's largest party warned Tuesday that the island could default on its debt as Moody's slashed its credit rating and a bitter power struggle dragged into a fourth week, Daily Mail reported. The South Asian nation has been gripped by an unprecedented political crisis since the president sacked his prime minister on October 26 and appointed former strongman Mahinda Rajapakse in his place. Ranil Wickremesinghe, the ousted premier and leader of the United National Party -- the largest single party in parliament -- refused to step down, declaring his sacking illegal.