Moody's revised Kenya's sovereign credit rating from negative to positive, seven months after a downgrade. The global rating agency said the revision is due to the increasing likelihood of a reduction in Kenya's liquidity risks and an improvement in debt capacity over time.

With heavy debt, Kenya has been seeking new lines of financing since last year due to national protests against proposed tax increases. Moody's noted a potential decrease in liquidity risks and improved debt accessibility in a timely manner

Domestic financing costs have started to fall as part of a monetary easing cycle and this trend could continue if the Kenyan government manages its fiscal consolidation effectively, paving the way for external financing options, according to the report.

"Given low inflation and stable exchange rates, there is potential for further reduction in domestic borrowing costs, with past monetary policy rate cuts affecting long-term borrowing costs,” Moody's said.

The agency confirmed Kenya's long-term issuer ratings in local currency and foreign currencies to “Caa1", citing still high credit risks due to very low debt accessibility and high gross financing needs compared to financing options.