Moody's lowers Pakistan outlook to negative

Moody's Investors Service said it changed the outlook to negative from stable on the B1 government foreign- and local-currency bond ratings of Pakistan, following President Musharraf's imposition of emergency rule during the weekend.

A negative outlook was also placed on Pakistan's B2 foreign-currency country ceilings for bank deposits, the agency said.

The outlook for Pakistan's Ba3 foreign-currency country ceiling for bonds is unaffected by today's action and remains stable, Moody's added, noting that it believes that the imposition of emergency rule represents a further erosion in Pakistan's governing capacity and underscores Pakistan's heightened political instability.

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