S&P Global Ratings lifts Pakistan’s sovereign rating to 'B' for first time since 2016
AI Market Summary
S\u0026P Global upgraded Pakistan\u0027s sovereign rating to B from B-, citing sharply higher FX reserves, a narrower fiscal deficit, and progress on IMF-backed reforms and institutional stability. The action is supportive for Pakistan\u0027s funding backdrop but remains deep non-investment grade, with S\u0026P flagging debt-servicing burdens, security risks, and regional tensions as ongoing constraints. The news has limited direct transmission to major global assets.
Impact level
● Low
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S&P Global upgraded Pakistan’s sovereign credit rating from B- to B, its first such move since 2016, citing stronger external buffers and improved fiscal metrics. Foreign exchange reserves rose to $25.3 billion from $6.7 billion in December 2022, while the fiscal deficit narrowed to 4% from nearly 8% in FY2022-23. The agency also pointed to IMF-backed reforms and greater institutional stability, but warned that debt-servicing costs, security risks and regional tensions remain constraints, according to S&P Global.
