ISLAMABAD: Global rating agency Moody's has said that Pakistan's macroeconomic situation has improved with banking outlook upgraded from stable to positive, and the country's economy is set to register a three percent growth. The global rating agency, in a statement, said "We have changed our outlook on Pakistan's banking system to positive from stable to reflect the banks' resilient financial performance as well as improving macroeconomic conditions from very weak levels a year ago." Moody's said "The positive outlook on the sector also mirrors the Government of Pakistan's (Caa2 positive) positive outlook, with Pakistani banks having significant exposure to the sovereign through their large holdings of government securities, which account for around half of total banking assets. However, Pakistan's long-term debt sustainability remains a key risk, with its still very weak fiscal position, high liquidity and external vulnerability risks."