Moody’s Investors Service – one of the world’s top three credit rating agencies – on Thursday downgraded Pakistan’s outlook from stable to negative. The decision to change the outlook to negative is driven by Pakistan’s heightened external vulnerability risk and uncertainty around the sovereign’s ability to secure additional external financing to meet its needs, the rating agency said in its report.
However, it affirmed the ‘B3’ local and foreign currency long-term issuer and senior unsecured debt ratings.
Moody’s assessed that Pakistan’s external vulnerability risk has been amplified by rising inflation, “which puts downward pressure on the current account, the currency and – already thin – foreign exchange reserves, especially in the context of heightened political and social risk”.
Source: Express Tribune