Fitch upgrades Pakistan’s sovereign credit rating to CCC+ following IMF pact

Global credit rating agency Fitch on Monday upgraded Pakistan’s long-term foreign-currency issuer default rating (IDR) to CCC+ from CCC on the back of the country’s deal with the International Monetary Fund (IMF), a statement from the agency confirmed. According to Fitch, a CCC rating is a speculative or junk grade indicating the issuer has a high risk of defaulting on its debt obligations. Last year, the agency had upgraded Pakistan’s long-term foreign currency issuer default rating from ‘CCC-’ to ‘CCC’ in July, following the approval of an IMF loan. However, the rating had still indicated a significant country credit risk. “The upgrade reflects greater certainty over the continued availability of external funding, in the context of Pakistan’s staff-level agreement (SLA) with the IMF on a new 37-month $7 billion extended fund facility (EFF),” the agency said on Monday.