Barclays upgraded Pakistan debt to overweight on oil outlook: Bloomberg
- Pakistan economy continues to demonstrate stability, with an improved fiscal position, report says
Barclays upgraded Pakistan's dollar bonds to overweight due to improved oil market prospects, a stable economy, and robust external financing, reversing a previous downgrade.
- Barclays' rationale for upgrading Pakistan's dollar bonds.
- Pakistan's improved economic stability and external buffers.
- Specific recommendations for buying and selling bonds.
- Prospects for future credit rating upgrades by 2026.
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.
“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.
Comments