Moody’s Investors Service has upgraded Kenya’s long-term sovereign credit rating to ‘B3’ from ‘Caa1’, reflecting reduced default risk as the country strengthens its external liquidity and fiscal buffers. The upgrade comes with a stable outlook, according to TradingView, which cited Moody’s statement on the improved resilience of Kenya’s finances.
The rating action reflects a rise in Kenya’s foreign exchange reserves, which reached $12.2 billion at the end of 2025, equivalent to about 5.3 months of import cover, up from $9.2 billion a year earlier, Investing.com reported. Moody’s also highlighted a narrower current account deficit supported by stronger exports, higher remittances, and a larger services surplus.
Kenya’s successful return to international capital markets in 2025 further strengthened its credit profile. Two Eurobond issuances totalling $3 billion were used in part to buy back bonds maturing between 2026 and 2028, easing near-term financing pressures and improving debt maturity, as cited by Reuters.
Despite the upgrade, Moody’s cautioned that Kenya’s debt affordability remains weak and fiscal deficits are elevated, which could limit future credit improvements unless domestic financing conditions and fiscal consolidation continue. The agency also raised Kenya’s local- and foreign-currency rating ceilings, signalling a stronger overall credit position, CNBC Africa reported.
