Barclays upgraded Pakistan debt to overweight on oil outlook: Bloomberg

Barclays Bank Plc has upgraded Pakistan dollar bonds to overweight after lowering the rating in May, citing improved oil market prospects, according to a Bloomberg report that was also shared by Finance Minister’s adviser Khurram Shehzad on Wednesday.

Pakistan economy continues to demonstrate stability, with an improved fiscal position, steadier external buffers, relatively steady foreign reserves, and a moderate growth/inflation picture, as per the report.

• Overweight - The stock is expected to outperform the unweighted expected total return of the industry coverage universe over a 12-month investment horizon.

“The resilience of Pakistan’s external position cannot be ignored and it underpins the more optimistic view,” Bloomberg quoted as a note written by analysts including Avanti Save.

“Multilateral and bilateral financing backstops are intact as the country’s geopolitical position remains critical to Central Asia and the Middle East – a potential tailwind,” the report added. “Recommends buying the 2031, 2036, 2051 sovereign dollar bonds and the 2031 bond issued by Pakistan Water & Power Development Authority; sell the 5-year Pakistan credit default swap.”

While credit rating upgrades have taken longer to materialise, agencies may look to review and conclude positively on ratings in 2H 2026, as per the report.

Barclays PLC is a British multinational universal bank, headquartered in London, England. Barclays operates as five divisions: the UK Consumer Bank, UK Corporate Bank, Private Bank and Wealth Management (PBWM), Investment Bank, and the US Consumer Bank.

Barclays fundamental equity research rating system

Barclays’ coverage analysts use a relative rating system in which they rate stocks as Overweight, Equal Weight or Underweight relative to other companies covered by the analyst or a team of analysts that are deemed to be in the same industry.

Overweight - The stock is expected to outperform the unweighted expected total return of the industry coverage universe over a 12-month investment horizon.

Equal weight - The stock is expected to perform in line with the unweighted expected total return of the industry coverage universe over a 12-month investment horizon.

Underweight - The stock is expected to underperform the unweighted expected total return of the industry coverage universe over a 12-month investment horizon.

Rating suspended - The rating and target price have been suspended temporarily due to market events that made coverage impracticable or to comply with applicable regulations and/or firm policies in certain circumstances including where the Investment Bank of Barclays Bank PLC is acting in an advisory capacity in a merger or strategic transaction involving the company.