BRIEF-S&P Says Pakistan Outlook Revised To Negative On Weakening External Position 'B-' Rating Affirmed

BY Reuters | CORPORATE | 07/28/22 08:21 AM EDT

July 28 (Reuters) - S&P :

* S&P SAYS PAKISTAN OUTLOOK REVISED TO NEGATIVE ON WEAKENING EXTERNAL POSITION; 'B-' RATING AFFIRMED

* S&P SAYS PAKISTAN'S EXTERNAL POSITION IS WEAKENING DUE TO HIGHER COMMODITY PRICES, RUPEE DEPRECIATION, AND TIGHTER GLOBAL FINANCIAL CONDITIONS

* S&P ON PAKISTAN SAYS EXTERNAL RESOURCES ARE LIKELY TO REMAIN UNDER PRESSURE EVEN AFTER EXPECTED DISBURSEMENTS FROM IMF UNDER THE RESTORED EFF PROGRAM

* S&P SAYS NEGATIVE OUTLOOK REFLECTS GROWING RISKS TO PAKISTAN'S EXTERNAL LIQUIDITY POSITION OVER THE NEXT 12 MONTHS

* S&P ON PAKISTAN SAYS GOVERNMENT'S FISCAL PERFORMANCE WILL FACE INCREASING STRAIN FROM HEIGHTENED INTEREST SERVICE COSTS

* S&P SAYS RATINGS ON PAKISTAN REMAIN CONSTRAINED BY A NARROW TAX BASE AND DOMESTIC AND EXTERNAL SECURITY RISKS, WHICH ARE ELEVATED

* S&P SAYS HUMANITARIAN & SECURITY CONDITIONS IN NEIGHBORING AFGHANISTAN COULD POSE ADDITIONAL RISKS TO PAKISTAN'S DOMESTIC SECURITY IN THE YEARS AHEAD

* S&P SAYS REVISED OUTLOOK TO NEGATIVE TO REFLECT PAKISTAN'S WEAKENING EXTERNAL METRICS AGAINST BACKDROP OF HIGHER COMMODITY PRICES

* S&P SAYS IT EXPECTS PAKISTAN TO ACHIEVE MODERATE GROWTH OVER NEXT FEW YEARS, BUT TIGHTER DOMESTIC MONETARY CONDITIONS & ELEVATED INFLATION LIKELY TO WEIGH ON ACTIVITY

* S&P-EXPECT PAKISTAN'S FOREIGN EXCHANGE RESERVES TO REMAIN HEAVILY DEPENDENT UPON RENEWAL OF EXISTING BILATERAL CREDIT AND COMMERCIAL LOAN FACILITIES

* S&P SAYS REVISED OUTLOOK TO NEGATIVE TO REFLECT PAKISTAN'S WEAKENING EXTERNAL METRICS AGAINST BACKDROP OF WEAKENING RUPEE

* S&P ON PAKISTAN SAYS EXPECT INFLATION TO REMAIN ELEVATED FOR THE REMAINDER OF THIS YEAR, BEFORE GRADUALLY MODERATING FROM 2023 ONWARD

* S&P ON PAKISTAN SAYS PREVAILING PRICE DYNAMICS LIKELY TO HURT PACE OF PRIVATE CONSUMPTION GROWTH IN CURRENT FISCAL YEAR ENDING JUNE 2023

* S&P SAYS PAKISTAN'S HIGHER INTEREST RATE ENVIRONMENT WILL PLACE ADDITIONAL UPWARD PRESSURE ON GOVERNMENT'S DEBT SERVICING COSTS OVER NEXT 2 TO 3 YEARS Source text for Eikon: Further company coverage: [ ]

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