Fitch rates Pakistan's proposed Eurobond at 'B-'

According to Mettis Global, Fitch Ratings has placed a 'B-' rating on Pakistan's planned US dollar bond. The agency also attached a Recovery Rating of 'RR4', which points to average recovery prospects for investors should a default occur. Proceeds from the issue will go toward budget and sovereign financing needs, the agency said.

The bond rating mirrors Pakistan's long-term foreign-currency default rating, which Fitch confirmed on April 13, 2026 with a stable view. Fitch said the bond rating will track any change in the sovereign rating, with external and fiscal positions among the main drivers. On the downside, renewed pressure on external liquidity could lead to a downgrade, with persistently high oil prices or a sharp fall in remittances cited as risks.

Upside factors include a clearer reduction in external financing pressure, better access to funding and foreign-currency reserves building beyond current projections. A substantial cut in government debt would also help, particularly if fiscal tightening remains on course under IMF commitments and lifts tax revenue. Fitch also flagged governance factors, with Pakistan ranking in the 18th percentile on World Bank governance indicators.