Moody’s holds Pakistan’s credit rating

KARACHI: Moody’s Investors Service has left Pakistan’s long-term issuer rating unchanged at ‘Caa3’, suggesting the country is facing high credit risk, as doubts arise over the new government’s ability to swiftly negotiate a new International Monetary Fund (IMF) loan programme after the current one expires in April 2024. The global rating agency maintained a ‘stable outlook’ on the credit rating. In another development, Bank of America (BofA) has upgraded Pakistan’s global Eurobond to ‘overweight’ in hopes that international rating agencies would improve the country’s credit rating. However, this expectation proved untrue in the case of Moody’s latest periodic review. The investment bank also linked the future valuation of Pakistan’s international bonds with the acquisition of the next IMF loan programme (on time). According to a local media outlet, Moody’s warned that it remains highly uncertain whether the newly elected government of Pakistan would be able “to quickly negotiate a new IMF programme soon after the ongoing programme expires in April.”