Ethiopia's Default Crisis Deepens as Bond Payments Remain Unpaid

Fitch Ratings has downgraded Ethiopia's credit rating further into junk territory, citing an "increased likelihood" of default. The country failed to pay a coupon on its $1 billion Eurobond, prompting Fitch to cut its rating to "C". If Ethiopia does not pay the coupon within a 14-day grace period, Fitch will downgrade it to "RD" or restricted default. The country's economy is still struggling with high inflation, hard currency shortages, and growing external debt repayments. Ethiopia has requested debt relief under the G20's Common Framework and has agreed to a debt service suspension with its official creditors. Talks with bondholders have broken down, and the government is in discussions with the IMF for a new lending program.