Business

Bulls return to PSX after IMF greenlights govt’s circular debt plan

Published

2 years ago

Farwa

The bulls returned to the Pakistan Stock Exchange on Wednesday after the International Monetary Fund (IMF) approved the government’s plans to reduce the circular debt balance.

The benchmark KSE-100 Index closed the day on a positive note with gain of 797.78 points or 1.68% to settle at 48,227.60.

Bulls return to PSX after IMF greenlights govts circular debt plan

Arif Habib Limited’s Head of Research Tahir Abbas stated that for the last two days, bears were dominating the market as there was “selling pressure”.

Abbas said that the “selling pressure” was there as the investors were busy in profit taking and there was uncertainty with regard to the caretaker prime minister and who will take over from Finance Minister Ishaq Dar in the interim setup.

“Apart from that, there were question marks on circular debt due to which we saw selling in two days. This has reversed today and the market saw positive momentum,” he added.

Another reason for the bulls’ domination of the marker as per the expert was the finalisation of a caretaker setup. “Apart from that there was news that the IMF has given the go-ahead on the circular debt resolution due to which we saw across-the-board positive momentum.”

On the other hand, capital market expert Saad Ali said that the market rejuvenated after yesterday’s correction following the new development related to the energy sector.

“There was news that the IMF has approved the government’s plans to reduce the circular debt balance in the gas chain through the dividends of state-owned E&Ps,” said Ali.

A day earlier, the Cabinet Committee on Energy (CCOE) approved the revised Circular Debt Management Plan (CDMP).

It has been envisaged under the revised the CDMP that the quarterly tariff adjustments and fuel adjustments would be charged from consumers in a timely manner after raising the baseline tariff. There would be no untargeted subsidy for any sector.

Business

E&P Companies Will Invest $5 Billion in Pakistan’s Petroleum Industry

Published

3 hours ago

Farwa

Over the next three years, local and foreign companies involved in Pakistan’s oil and gas exploration and production sector have shown a strong desire to invest more than $5 billion in the nation’s energy sector.

Recent changes to the Petroleum Policy and the implementation of an exclusive tight gas policy, which provide better incentives and a more investor-friendly regulatory framework, are credited with the increase in investor confidence.

These strategic changes are expected to boost domestic energy production, open up new avenues for growth, and draw large amounts of both domestic and foreign investment.

Business

With inflation slowing, the SBP is anticipated to lower the policy rate for the eighth time in a row.

Published

3 hours ago

Farwa

Businesspeople anticipate another reduction in the policy rate when the State Bank of Pakistan’s (SBP) Monetary Policy Committee (MPC) releases the updated rate.

The interest rate for the upcoming two months will be announced by the central bank. It is still unclear if the rate will stay the same or be lowered to reflect stakeholder expectations.

According to experts, the policy rate will be lowered in order to further boost the nation’s economic sector.

Interest rates may be lowered for the seventh time in a row if the inflation rate declines significantly more than anticipated.

In its last six sessions, the MPC had cut the policy rate by 10 percent. In January 2025, it decreased the rate by one percent to 12pc.

12PC POLICY RATE

In January, the State Bank of Pakistan (SBP) announced cut in key policy rate by 100 basis points (bps) to 12 percent from 13pc in line with expectations of the business community.

The policy rate, which had been at 22 percent since June 2024, was slashed by 1,000 basis points to 12 percent.

The SBP governor said the decision was taken with careful consideration. “Although inflation is expected to decline next month (February), core inflation remains a pressing concern,” he stated.

Ahmed highlighted strong remittance inflows and robust export growth as key factors supporting the current account.