S&P drops Pakistan

Standard & Poor's said it lowered its long-term foreign currency sovereign credit rating on the Islamic Republic of Pakistan to CCC+ from B and its long-term local currency rating to B- from BB-.

At the same time, the agency said it lowered its short-term rating on the sovereign to C from B.

The outlook on the long-term rating is negative.

The rating on Pakistan's senior unsecured local currency debt has also been lowered to B- from BB-, while the foreign currency debt rating has been lowered to CCC+ from B, the agency noted.

S&P said that the downgrade comes in the wake of continued steep erosion of Pakistan's external liquidity position, the extent and pace of which casts rising doubts about the sovereign's ability to meet about $3 billion of external debt servicing commitments in the coming year.

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