The economy of Saudi Arabia is expected to slow down noticeably as a result of lower oil prices, though the fiscal policies are adapting, the IMF said Thursday.

Moody's Investors Service this week lowered the credit rating for Saudi Arabia by one notch from Aa3 to A1. While strong when compared with other sovereigns, Moody's said the Saudi economy would not be spared from the pressure of lower crude oil prices.

A survey from the International Monetary Fund said the decline in crude oil prices, off roughly 20 percent from this time last year, could translate to a 1.2 percent increase in real gross domestic product for Saudi Arabia this year. That's compared with 3.5 percent growth in 2015.

Moody's, for its part, said it expected the Saudi economy to grow at an average rate of 2 percent, compared with the 5 percent growth rate in the four years ending in 2015.

An economic agenda, dubbed Vision 2030, aims to boost Saudi Arabia's non-oil revenue, something the IMF said should help drive forward momentum. Vision 2030, the IMF said, is "bold and far-reaching" but should help diversify the Saudi economy and increase the role of a private sector governed traditionally by the monarchy. This, in turn, should create a more vibrant employment scenario for Saudi nationals.

According to the World Bank, unemployment in Saudi Arabia has held relatively steady at around 5.5 percent, down from the 6.3 percent recorded 10 years ago. By the World Bank's estimates, Saudi Arabia's economy grows slower than developing Middle East and North African countries, but stays on pace with the global average.

A January forecast from the World Bank said oil exporters in the region should see GDP growth of 6.2 percent this year. Saudi Arabia's growth, meanwhile, stays below 3 percent at least through 2018.

Nevertheless, the IMF said the fiscal policy in Saudi Arabia is adjusting to the drop in crude oil prices, though reforms are still needed.

"A gradual, but sizeable and sustained fiscal adjustment needs to continue with the aim of achieving a balanced budget over the medium-term," the IMF's Tim Callen said in a statement. "Such fiscal consolidation should include further adjustments in domestic energy prices, firm control of expenditures, and further increases in non-oil revenues."