S&P Global Ratings has upgraded Pakistan’s sovereign credit rating from ‘CCC+’ to ‘B-’ with a stable outlook, citing improved financial stability supported by the International Monetary Fund (IMF). The rating agency stated that ongoing economic recovery and better revenue generation by the government are expected to stabilise Pakistan’s fiscal and debt indicators in the coming months.
S&P also noted that consistent official financing will help Pakistan meet its external debt payments. It expects that the country will continue to roll over its commercial credit lines over the next year, maintaining external liquidity. Following the announcement, Pakistan’s international bonds saw a rise, with the 2051 bond gaining 1.6 cents to reach 84.85 cents on the dollar.
Prime Minister Shehbaz Sharif welcomed the upgrade and said it proves that the country is on the path to economic stability. He highlighted that the improved rating will boost investor confidence and ease the burden of external debt payments. He also appreciated the efforts of his economic team for implementing strong and effective financial policies.
The prime minister added that international institutions and rating agencies were now recognising the government’s successful steps to improve the economy. The credit rating improvement is expected to help Pakistan access global financial markets under better conditions and attract more foreign investment in the coming months.
This development follows similar upgrades by other agencies. In April, Fitch raised Pakistan’s rating from ‘CCC+’ to ‘B-’, citing growing trust in the government’s measures to reduce its budget deficit. Earlier, in August 2024, Moody’s also improved Pakistan’s rating to Caa2 from Caa3 and shifted the outlook to positive due to better external and liquidity positions.
Finance Minister Muhammad Aurangzeb recently met with Moody’s officials, urging them to further raise Pakistan’s rating. He shared the country’s economic reform plans and progress, aiming to ensure Pakistan’s return to international capital markets under more favourable terms.