We derive the optimal fiscal policy for a government which is committed to honoring its debt but faces investors which fear a sovereign default. We assume that investors are able to learn form new evidence, as in Marcet and Sargent (1989), so that they can gradually correct their overly pessimistic view about government’s creditworthiness. We show that in an economy with these features, contrary to the prescriptions of more standard models, a frontloaded fiscal consolidation after an adverse fiscal shock is optimal.