Fitch maintains Pakistan's ratings at 'CCC'

An American credit rating agency, Fitch Ratings on Wednesday issued Pakistan’s Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘CCC’, ARY News reported.

According to the details, Fitch Ratings typically does not assign outlooks to sovereigns with a rating of ‘CCC+’ or below.

The key rating that assisted the currency positively was Pakistan’s IMF staff-level agreement (SLA) in November, which was approved by the IMF Executive Board in July 2023.

Moreover, the performance of the caretaker government also played a pivotal role in improving the currency rating.

With the Stand-by Arrangement (SBA) with the IMF set to expire in March 2024, Fitch Ratings anticipates that the government elected in the February 2024 election will promptly pursue another IMF program.

Nevertheless, further delays to elections or renewed political volatility can jeopardise IMF negotiations and external funding.