Weekly review of Pakistan’s Economy, Stock Markets, and Sensitive Price Indicator during the week ending on 07th of April 2023.
IMF Talks for 9th Review
No favorable signs for the finalization of talks between the Government of Pakistan and the IMF for the ninth review of financial support have been witnessed during the week. Although most of the demands of the IMF have been fulfilled including reasonable assurance of the support of US$ 2 billion from a friendly country. The only point is the pending assurance from a friendly country for US$ 1 billion.
The Foreign Minister of Pakistan has postponed the visit to attend the IMF-World Bank spring talks to be held in Washington from the 10th to 16th of April 23 pointing to the political turmoil in the country. He said that the meeting will be attended virtually.
After the decision of the Supreme Court of Pakistan to hold elections in the Punjab province, the court directed the Federal Government to release PKR 21 billion to the Election Commission of Pakistan for the elections by the 10th of April 2023.
Trade Deficit
The trade deficit has reduced during the week to US$ 1.46 billion down by 21% on the month on month basis (MoM) which is attributed to the reduction in imports by 5% and the increase in the exports by 8%as from the previous month.
Policy Interest Rate
The State Bank of Pakistan has increased the interest rate by 100 basis points (1%) now at 21% to curb inflation. With the rising interest rate, business activity in the country is badly affected as the cost of doing business is getting higher making it difficult for the industry to carry on business activity in a profitable manner. The rise in the interest rate has also affected the other investment opportunities in the country including real estate and stock exchange, as investors prefer to invest in risk-free investments with higher returns.
Foreign Reserves
The foreign reserves of the country with the State Bank remained almost stable at a level of US$ 4.2 billion during the week.
Stock Market
The Stock Market of Pakistan showed mixed trends during the week owing to the decisions of the Supreme Court regarding elections in Punjab Province and the increase in the interest rate by the State Bank of Pakistan. The KSE 100 index closed at 40050 points on Friday the 7th of April 2023. For details, click on the following link:-
Pakistan Stock Exchange weekly review 3-7 April 2023
Sensitive Price Indicator (SPI)
The Sensitive Price Index for the week ended on the 7th of April 2023 increased by 0.92%. The major increase observed in the prices of food items observed is Chicken (15.87%), Sugar (13.48%), Potatoes (5.11%), Bananas (4.95%), Wheat Flour (3.10%), Gur (2.12%) Eggs (1.26%), Fresh Milk (1.24%) and non-food item, Long Cloth (1.95%).
The decrease in prices of major items noted during the week was Tomatoes (14.96%), Onions (12.66%), LPG (3.73%), Pulse Gram (1.2%), Vegetable Ghee 2.5 Kg (0.71%), Garlic (0.16%) and Mustard Oil (0..3%).
During the week, out of 51 items, prices of 27 (52.94%) items increased whereas, a decrease in the prices of 7 (13.73%) items was observed and prices of 17 (33.33%) items remained stable.
Note: The information shared above is as per the report issued by the Pakistan Bureau of Statistics.
For the weekly review of Pakistan’s economy for the last week that ended on 31st of March 23, click on the following link:-