Pakistan’s long-term foreign currency issuer default rating received a boost as global rating agency Fitch upgraded it from ‘CCC-’ to ‘CCC’ on Monday.
The upgrade was attributed to enhanced external liquidity and improved funding conditions, which were a result of the recent staff-level agreement between Pakistan and the International Monetary Fund on a nine-month Stand-by Arrangement in June.
The executive
board of the IMF will meet on July 12 to review the $3 billion Stand-by Arrangement for Pakistan.
“We expect the SLA to be approved by the IMF board in July, catalysing other funding and anchoring policies around parliamentary elections due by October,” Fitch said in a statement while talking about IMF-driven reforms taken by the government.
However, the rating agency said the IMF programme implementation and external funding risks remain due to a volatile political climate and large external financing requirements.
