UPDATE 1 — Moody's upgrades Egypt by a notch as structural reforms bolster economic resilience

(Adds details from Moody's report, background throughout) Oct 16 (Reuters) — Moody's upgraded Egypt's long-term sovereign credit rating by one notch to "B3" from "Caa1" on Friday, citing strong fiscal consolidation and structural reforms. "The shift to a flexible exchange rate and tighter monetary policy has strengthened external buffers and the economy's capacity to absorb shocks," the global credit ratings agency said in a statement. It maintained the country's outlook at "positive". The International Monetary Fund said on Thursday Egypt has made good progress in restoring macroeconomic stability despite external challenges, however, it must speed up structural reforms to reduce the state's footprint in the economy. The North African country, which is preparing for the final review of $8 billion in IMF loans in the coming weeks, has indicated it would not seek further IMF financing after the facility expires in December. "The government's ability to sustain this credit-positive trend despite a challenging external environment and higher oil prices highlights the durability of the improvement, rooted in increased policy effectiveness," Moody's said. Egypt's economy grew 5.1% in th