Pricing Reform Progress: Evidence from Sovereign Spreads and Consensus Forecasts

Investors reward reform progress. The progressive tightening of Qatar’s external sovereign credit spreads was underpinned by holistic reforms, fiscal spending discipline, and monetary policy credibility. In particular, investors may view fiscal spending discipline as an integral part of Qatar’s holistic reform and economic diversification. Greater broad-based reform progress also boosts the resilience of sovereign credit spreads to external shocks. The findings support fiscal and monetary policy reforms as part of the broader reform agenda in a holistic manner, as planned under the Third National Development Strategy.