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S&P downgrades Ukraine's rating over political turmoil

Standard & Poor's has downgraded Ukraine's rating to 'negative' from 'stable' due to the deteriorating political situation in the country and associated economic policy risks, the international ratings agency said Thursday.

After Western-leaning President Viktor Yushchenko, who has been embroiled in a standoff with the premier, decreed that parliament be dissolved and early elections be scheduled for late May, parliament refused to obey and referred the decree to the Constitutional Court. Ukraine's Constitutional Court said Thursday it would decide within 15 days whether the deputies' representation on the legality of the parliament's dissolution by the president is worth considering in essence, or whether it does not merit further consideration. The latest twist in the simmering political crisis in the former Soviet nation of 47 million was triggered after 11 members of Tymoshenko's and pro-presidential Our Ukraine blocs defected to the majority coalition March 23.

Yushchenko, whose powers were drastically curtailed by a Cabinet law early this year, said the defections were against the Constitution. The pro-Russian Prime Minister Viktor Yanukovych promised to revise the law on the Cabinet if the president backtracked on his decree. Political speculation continued as the Party of Regions said Yushchenko was also preparing to dismiss the government, which had allowed the Supreme Rada to continue working despite the presidential order. Several thousand supporters of the ruling coalition, which also comprises the Communists and Socialists, rallied in central Kiev Wednesday. Several hundred reportedly plan to stay in a tent camp until the Constitutional Court rules on the presidential decree. (