Fitch says Ukraine politics may hit foreign investment

LONDON (Reuters) - Credit ratings agency Fitch is concerned the collapse of Ukraine's coalition government could deter foreign investment, it said on Wednesday, but saw no immediate risk of a ratings downgrade.

Fitch director of emerging Europe sovereigns Andrew Colquhoun told Reuters the agency remained much more concerned about macroeconomic stresses within the Ukrainian economy such as double-digit inflation, rising external debt levels and its current-account deficit.

"There is a risk this will increase worries over political stability and deter foreign investment," he said. "Obviously, it would be positive for Ukraine's creditworthiness to have a stable government able to take the necessary economic policies... we are much more worried about the macroeconomy."

He said it was too soon to say what kind of a new coalition if any would emerge and what that would mean, but saw no immediate ratings action by Fitch.

Fitch rates Ukraine BB- with a stable outlook.