S&P Global on Thursday elevated Pakistan’s sovereign credit rating to ‘B-‘ from ‘CCC+’ and assigned it a ‘stable’ outlook. The ratings agency stated that the country’s finances and reserves have been stabilized due to support from the International Monetary Fund (IMF).
“The stable outlook reflects our expectations that continued economic recovery and government efforts to enhance revenue will stabilize fiscal and debt metrics,” S&P said in a statement regarding the upgrade. The agency further added, “We also expect that sustained official financing will support Pakistan in meeting its external obligations, and that the country will continue to roll over its commercial credit lines over the next 12 months.”
Following the upgrade, Pakistan’s longer-dated international bonds rallied. According to Tradeweb data, the 2051 maturity bond gained 1.6 cents, with bids reaching 84.85 cents on the dollar. The 2031 and 2036 maturities also saw gains of approximately 1 cent, while shorter-dated maturities experienced smaller increases.
Prime Minister Shehbaz Sharif expressed satisfaction with the improvement in Pakistan’s credit rating by S&P Global Ratings, affirming that it reflects the country’s economic stabilization. He highlighted that this upgrade will enhance Pakistan’s access to international capital markets and alleviate pressure on external debt repayments. The Prime Minister further stated that Pakistan’s macroeconomic indicators are steadily improving, and this positive momentum is gaining recognition from global financial institutions and credit rating agencies.
Emphasizing the broader impact of the rating improvement, the Prime Minister noted that it would help restore investor confidence in the Pakistani economy. He also lauded the government’s economic policies, remarking that they are now receiving international acknowledgment. Prime Minister Shehbaz commended the efforts of the government’s economic team, describing their performance as commendable and a key factor in this positive development.
