Following improvements in Pakistan’s credit rating from international credit rating agencies, Moody’s and Fitch, S&P Global has upgraded Pakistan’s sovereign credit rating from ‘CCC+’ to a more respectable ‘B-’. According to reports, S&P Global assigned Pakistan a ‘stable’ outlook, citing the International Monetary Fund (IMF) program’s role in stabilising the country’s reserves and finances.

 

In a statement, S&P Global noted that Pakistan is expected to continue its economic recovery and that Islamabad’s efforts to boost revenue could improve key macroeconomic indicators related to debt and the fiscal budget.

 

The statement further suggests that, as per S&P Global, continued financing could help Pakistan meet its external repayments. Moreover, the country is likely to roll over “commercial credit lines over the next 12 months”.

 

Pakistan has been rolling over debt held by China, with reports from June 2025 suggesting that China rolled over a staggering $3.4 billion in debt to Pakistan. According to these reports, two senior government officials revealed details surrounding the rollover agreement that helped boost Pakistan's foreign exchange reserves.

 

These developments, primarily the upgrade in Pakistan’s credit rating by S&P Global, reportedly increased Pakistan’s international bonds with longer maturity dates. Data from reports suggests that bonds maturing in 2051 have gained 1.6 cents, causing bids to rise up to 84.85 cents on the dollar.

 

Similarly, bonds maturing in 2031 and 2036 posted a gain of approximately one cent. Bonds maturing before 2031 witnessed gains too; however, these were reportedly not as large as longer-dated maturities.

 

The federal government is in discussions with international credit rating agencies to find ways to improve Pakistan’s outlook. Reports reveal that just last week, Finance Minister Muhammad Aurangzeb requested Moody’s to upgrade Pakistan’s credit rating. If approved, it would help Pakistan borrow from international markets at more favourable conditions. 

 

Earlier this year, Moody's recognised improvements in the performance of Pakistan’s banking sector. The sector had displayed signs of progress over the previous year, after conditions in the wider economy weakened the sector.

 

Moody’s promoted the banking outlook in Pakistan from ‘stable’ to ‘positive’ in May 2025. Fitch, yet another renowned credit rating agency, also upgraded Pakistan’s economic outlook by boosting the country’s credit rating from CCC+ to B- before the end of fiscal year (FY) 2024-25.