Ratings agency S&P Global raised Pakistan’s sovereign credit rating to ‘B-’ from ‘CCC+’ and placed it on a ‘stable’ outlook on Thursday, saying the country’s finances and reserves had been stabilised by International Monetary Fund (IMF) support.

“The stable outlook reflects our expectations that continued economic recovery and government efforts to enhance revenue will stabilise fiscal and debt metrics,” S&P said in a statement on the move.

“We also expect that sustained official financing will support Pakistan in meeting its external obligations, and that the country will continue to roll over its commercial credit lines over the next 12 months.”

Pakistan’s longer-dated international bonds rallied after the upgrade, with the 2051 maturity gaining 1.6 cents to be bid at 84.85 cents on the dollar, according to Tradeweb data.

The 2031 and 2036 maturities also gained around 1 cent, while shorter-dated maturities posted smaller gains.

Last week, Finance Minister Muhammad Aurangzeb urged the leading US rating agency — Moody’s — to improve Pakistan’s credit rating and help its return to international capital markets at favourable conditions.

Moody’s had upgraded Paki­stan’s credit rating by one notch in August 2024 to Caa2 from Caa3 (downgraded in February 2023 due to suspension of the IMF programme) and changed its outlook to positive from stable for improving macroeconomic conditions, including liquidity and external position from very weak levels.

Global ratings agency Fitch had upgraded Pakistan’s foreign currency credit rating to ‘B-’ from ‘CCC+’ in April, citing increased confidence in the country’s progress on narrowing its budget deficits.