Moody's dropped Greece's rating to C from Ca late yesterday, saying in a statement that investors who participate in the nation's debt exchange will get about 70 percent less than the face value of their holdings, Economist Shayne Heffernan said that, now officially Greece has defaulted. The deal constitutes a distressed exchange, and hence a default, the New York-based Moody's said.

The downgrade follows S&P's decision on Feb. 27 to lower Greece to selective default after the announcement of the plan for investors to trade their bonds for new securities. The swap will reduce Greece's 200 billion euros ($264 billion) of privately held debt by about half if all investors participate.

Greece negotiated the restructuring as it seeks to reduce national debt to 120 percent of gross domestic product by 2020, from 160 percent last year, and to meet the terms of a 130 billion euro international bailout.

The country faces a high risk of default even if the plan is successful, Moody's said. It will be unlikely to be able to sell bonds to private investors once its bailout package runs out, according to the rating company.

Shayne Heffernan

Shayne Heffernan oversees the management of funds for institutions and high net worth individuals.

Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.