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Fitch upgrades Greece to 'CCC' on third European bailout

A group of tourists take a selfie in front of the temple of the Parthenon atop the Acropolis in Athens, Greece.
Christian Hartmann | Reuters
A group of tourists take a selfie in front of the temple of the Parthenon atop the Acropolis in Athens, Greece.

Fitch Ratings upgraded Greek debt to "CCC" from "CC," the ratings agency said Tuesday.

The embattled country is expected to begin a third European bailout program after ministers agreed to a deal framework last week, boosting the nation's rating in Fitch's estimation.

The agency upped Greece's long-term foreign and local currency Issuer Default Ratings (IDRs) to "CCC," and said it also raised the country's rating on senior unsecured foreign and local currency bonds to the same grade. Fitch affirmed short-term foreign currency IDR at a "C" grade, and said it raised the country ceiling to "B-" from "CCC."

The program "is intended to facilitate an eventual return to market funding," Fitch said in a release, adding that risks to the bailout's success "remain high."

"It will take some time for trust to be restored between Greece and its creditors ... Meanwhile, the political situation in Greece remains unpredictable," Fitch said.

Read MoreGreek deal approved: Up to 86B euros for bailout

In fact, Greece's membership in the euro zone remains tenuous: If the bailout were to break down, "it is reasonable to assume" the risk of a Grexit would be "high," the ratings agency said.

But last week's developments implied that progress has been made in rebuilding relationships between Greece and its European creditors, Fitch said.

"Last week's deal was reached relatively quickly and without the brinkmanship seen in the run-up to previous deadlines," the release said. "This suggests that relations with the creditors have improved, as implied by the public statements from key players, although they remain delicate."