Standard and Poor's swiftly became the third credit ratings agency to downgrade Sri Lanka's sovereign rating in recent weeks, as the political crisis in Colombo deepened in recent days.

S&P followed moves by Fitch earlier today, and Moody’s two weeks ago, in downgrading Sri Lanka citing refinancing risks and an uncertain policy outlook.

It said that there had been a “significant erosion” in Sri Lanka’s political situation that had “weakened the sovereign's external financing conditions and reduced the likelihood that further reforms will improve Sri Lanka's macroeconomic fundamentals and institutionalize sustainable policy frameworks over the next 12-18 months".

A Sri Lankan finance ministry official admitted to Reuters that “it is a mess at the moment”.

“We have to come out of this dragging political crisis. The borrowing cost is anyway going to rise with this,” the official added.

Read more from S&P here.

Earlier today Fitch announced that Sri Lanka's long-term foreign-currency issuer default rating was to be downgraded to ‘B’ from ‘B+’.

“Fitch believes the ongoing political upheaval, which has disrupted the normal functioning of parliament, exacerbates the country’s external financing risks, already challenged by the tightening of global monetary conditions amid a heavy external debt repayment schedule between 2019 and 2022,” the agency said in a statement.

Sri Lanka’s Central Bank responded to the move by claiming that the decision was “too hasty”.

“We are of the view that actions by both rating agencies are too hasty as their decisions are based on short term political uncertainties,” said Central Bank Senior Deputy Governor Nandalal Weerasinghe. “Such uncertainties could be very short lived only for couple of weeks.”

Read more here.