Moody’s has upgraded the Maldives’ sovereign credit rating from Caa2 to Caa1 and assigned a stable outlook.
The agency pointed to a reduced risk of default following successful debt payments. The upgrade returns the rating to a previous level but does not eliminate concerns over fiscal pressures.
Moody’s warned that the budget deficit is rising and that the debt-to-GDP ratio remains above 100 percent. These factors continue to constrain the country’s credit profile despite the improved rating.
The decision follows recent external financing arrangements and debt-service actions by the government. No detailed breakdown of the specific payments that influenced the upgrade was released alongside the announcement.
A Caa1 rating still places the Maldives in the speculative grade. Investors and lenders will continue to monitor fiscal consolidation efforts and tourism revenue trends.
