NAIROBI, Jan. 28 (Xinhua) -- Global rating agency Moody's Ratings upgraded Kenya's sovereign credit rating to B3 from Caa1 and revised the outlook to stable.

Moody's said the upward revision reflected a marked decline in Kenya's near-term debt default risk, underpinned by strengthened external liquidity and improved access to both domestic and international financing.

"External liquidity has strengthened, reflected in higher foreign-exchange reserves, a narrower current account deficit and a more stable exchange rate," Moody's said in a statement on Tuesday.

The ratings agency further underscored Kenya's stronger external liquidity, significantly higher foreign exchange reserves that stand at 12.2 billion U.S. dollars, according to the Central Bank, and a narrower current account deficit.

According to Moody's projection, Kenya's fiscal deficit will remain at 6 percent of the gross domestic product (GDP) and public debt will stay stable at 67 percent of the GDP.

Chris Kiptoo, the principal secretary in the National Treasury, said in a statement on Wednesday that the new ratings showed Kenya's strengthened ability to meet external obligations and reduced refinancing pressures.

"The stable outlook signals that Moody's expects these gains to be sustained over the medium term, backed by ongoing economic reforms and better access to international capital markets. Overall, this upgrade represents a notable vote of confidence in Kenya's macroeconomic management and financing strategy," Kiptoo said. ■