Islamabad: Moody's Ratings upgraded Pakistan's credit rating, citing its improved financial position supported by a loan from the International Monetary Fund.

The agency upgraded the South Asian country to Caa1 from Caa2 with a stable outlook, it said in a statement.

The upgrade was secured after similar moves by SandP Global Ratings and Fitch Ratings in the past four months following repeated pledges by Prime Minister Shehbaz Sharif's government to stay the course on fiscal consolidation and multiple reforms set by the IMF.

Moody's Ratings upgraded Pakistan's credit rating, citing its improved financial position supported by a loan from the International Monetary Fund. The country's dollar bonds extended gains.

The agency upgraded the South Asian country to Caa1 from Caa2 with a stable outlook, it said in a statement. Other countries with a similar rating include Sri Lanka, Egypt and Tunisia.