Business

Debt payments dent SBP-held foreign exchange reserves

Published

2 years ago

Farwa

SBP’s forex reserves decrease by $36 million to $4.2 billion.
Reserves enough for less than a month’s worth of imports.
IMF funding is critical for Pakistan to shore up its reserves.

The State Bank of Pakistan (SBP)-held foreign exchange reserves fell further as the cash-strapped nation met its debt obligations to avoid a possible default, with the financing avenues contracting amid a stalled International Monetary Fund (IMF) programme.

In its weekly bulletin, the SBP said that its foreign exchange reserves have decreased by $36 million to $4.2 billion as of the week ended March 31, which will provide an import cover of less than a month.

The net forex reserves held by commercial banks stand at $5.51 billion, $1.3 billion more than the SBP, bringing the total liquid foreign exchange reserves of the country to $9.75 billion, the statement mentioned.

Pakistan’s $350 billion economy continues to dwindle amid financial woes and the authorities struggle to strike a staff-level agreement with the IMF.

The Washington-based lender has been in talks with the Pakistani authorities since end-January to resume the $1.1 billion loan tranche held since November, part of a $6.5 billion Extended Fund Facility (EFF) agreed upon in 2019.

The IMF funding is critical for Pakistan to unlock other external financing avenues to avert a default on its obligations.

The IMF has asked Pakistan to secure assurances on external financing from friendly countries and multilateral partners to fund its balance of payment gap for this fiscal year, which ends in June.

In this regard, Saudi Arabia has assured the Washington-based lender that it would provide $2 billion in additional deposits to Pakistan, according to a report published in The News.

The assurance from Saudi Arabia helped the Pakistan rupee recover from a historic low and boosted investors’ confidence in the stock market, sending it above the 40,000 points mark.

Minister for Finance and Revenue Ishaq Dar also held a meeting with US Ambassador to Pakistan Donald Blome, which, according to sources, has assured America’s support for Pakistan to unlock the stalled IMF programme.

However, World Bank and Asian Development have projected Pakistan’s GDP to fall below 1% in the ongoing fiscal year, while warning that the non-completion of the IMF programme, failure to secure financing from key bilateral partners and political instability may result in an eruption of a major macroeconomic crisis.

Business

With its second-largest surge ever, PSX approaches 114,000 points.

Published

3 days ago

Farwa

Driven by renewed activity from both private and government financial institutions, the Pakistan Stock Exchange (PSX) saw its second-largest rally in history on Monday.

The market regained many important levels in a single trading session as it rose with previously unheard-of momentum.

Intraday trading saw a top increase of 4,676 points, and the PSX’s benchmark KSE-100 Index gained 4,411 points to settle at 113,924 points. This impressive rebound demonstrated significant investor confidence by reestablishing the 100,000, 111,000, 112,000, and 113,000-point levels.

The market also saw the 114,000-point limit reestablished during the trading session.

The positive tendency was reflected when the market’s heavyweight shares touched its upper circuits. Among the most busiest trading sessions in recent memory, an astounding 85.78 billion shares worth a total of Rs55 billion were exchanged.

Experts credited the spike to heightened institutional investor activity and hope for macroeconomic recovery. Considered a major market recovery, the rally demonstrated the market’s tenacity and development potential.

Business

In interbank trade, the Pakistani rupee beats the US dollar.

Published

1 week ago

Farwa

In the international exchange market, the US dollar has continued to weaken in relation to the Pakistani rupee.

The dollar fell to Rs278.10 from Rs278.17 at the beginning of interbank trading, according to currency dealers, a seven paisa loss.

In the meantime, there was a lot of turbulence in the stock market, but it recovered and moved into the positive zone. The KSE-100 index recovered momentum and reached 116,000 points after soaring 1,300 points.

Both currency and stock market swings, according to analysts, are a reflection of ongoing market adjustments and economic uncertainty.

Business

Phase II of CPEC: China-Pakistan Partnership Enters a New Era

Published

2 weeks ago

Farwa

The cornerstone of economic cooperation between the two brothers and all-weather friends is still the China-Pakistan Economic Corridor, the initiative’s flagship project.

In contrast to reports of a slowdown, recent events indicate a renewed vigour and strategic emphasis on pushing the second phase of CPEC, known as CPEC Phase-2, according to the Ministry of Planning, Development, and Special Initiatives.

According to the statement, this crucial stage seeks to reshape the foundation of bilateral ties via increased cooperation, cutting-edge technology transfer, and revolutionary socioeconomic initiatives.

Planning Minister Ahsan Iqbal is leading Pakistan’s participation in a number of high-profile gatherings in China, such as the 3rd Forum on China-Indian Ocean Region Development Cooperation in Kunming and the High-Level Seminar on CPEC-2 in Beijing.

His involvement demonstrates Pakistan’s commitment to reviving CPEC, resolving outstanding concerns, and developing a strong phase-2 roadmap that considers both countries’ long-term prosperity.

At the core of these interactions is China’s steadfast determination to turn CPEC into a strategic alliance that promotes development, progress, and connectivity.

Instead of being marginalised, CPEC is developing into a multifaceted framework with five main thematic corridors: the Opening-Up/Regional Connectivity Corridor, the Innovation Corridor, the Green Corridor, the Growth Corridor, and the Livelihood-Enhancing Corridor.

With the help of projects like these, the two countries will fortify their partnership, and CPEC phase-2 will become a model of global economic integration and collaboration that benefits not just China and Pakistan but the entire region.