Moody's lifts Pakistan sovereign rating to B3 from Caa1, cites governance improvement and easing of external risk

Dawn reported that Moody's on Monday raised Pakistan's sovereign credit rating to B3 from Caa1. The global agency linked the decision to stronger governance and reduced risks to the country's external position. Moody's kept the outlook on the rating at stable.

In its statement, the agency said it expects recent gains in the country's ability to service debt to last, supported by steady macroeconomic conditions. Khurram Schehzad, Adviser to the Finance Minister, publicised the decision on X and noted that Moody's had followed S&P Global Ratings.

A month earlier, S&P Global Ratings had lifted the long-term rating to B from B-, pointing to a stronger external position and a slow move toward economic stability. A sovereign rating reflects how well a government can meet its debt obligations, and higher grades can make it easier to draw foreign funds and borrow on more favourable terms.