Business

Chances of Pakistan securing IMF bailout are ‘dimming’: Moody’s

Published

1 year ago

Farwa

Pakistan may not be able to complete the IMF programme.
“Pakistan could default,” says sovereign analyst with Moody’s.
Pakistan is making a final effort to revive its IMF programme.

As the coalition government struggles to meet external debt obligations, Moody’s Investors Service has warned that Pakistan is at an increased risk of failing to restart its $6.7 billion bailout programme with the International Monetary Fund (IMF), putting the country closer to a sovereign default.

“There are increasing risks that Pakistan may be unable to complete the IMF programme that expires at the end of June,” a sovereign analyst with the rating company in Singapore Grace Lim said.

Lim said: “Without an IMF programme, Pakistan could default, given its very weak reserves.”

Pakistan is making a final effort to revive its IMF programme, with a financing gap of $2 billion and exchange-rate policy among the biggest hurdles. While the government has pledged to meet billions of debt obligations, investors have remained sceptical about the nation’s dollar bonds trading in the distressed territory since last year.

Pakistan faces about $23 billion of external debt payments for the fiscal year 2023-24, which begins in July. The amount is roughly five times its reserves and most of it is taken from concessional multilateral and bilateral sources.

On Monday, State Bank of Pakistan (SBP) Governor Jameel Ahmad denied officials were seeking debt restructuring talks as the country will pay $900 million of sovereign debt in June and expects $2.3 billion of obligations to be rolled over.

The country’s $1 billion bond due in April next year was little changed at about 55.6 cents on the dollar in Asian trading on Wednesday, after sliding almost three cents in the previous two days.

Rupee pressure

The rupee, which is trading near a record low against the dollar, may face further downward pressure, Lim said in an emailed response to questions.

The IMF’s comments on the exchange rate likely referred to the gap in the interbank and retail markets, she said.

The local currency has lost more than 20% this year after officials devalued the currency in January, making it one of the worst performers globally.

Pakistan’s financing options beyond June are highly uncertain, even as its external repayments will remain significant over the next few years, Lim said. Continuing engagement with the IMF would support additional financing from other multilateral and bilateral partners, which could reduce default risk, she said.

Separately, Pakistan is looking to purchase spot shipments of liquefied natural gas for the first time in roughly a year after a rapid drop in overseas prices. This suggests that Pakistan may see itself on a better financial footing, as suppliers were hesitant to sell fuel to the nation last year out of fear it may not be able to meet future payments.

Business

An investigation was “launched” into PTA’s inability to get Rs. 78 billion back from Telcos

Published

17 hours ago

Farwa

The PTA has reportedly been instructed to reply to NAB by July 29. According to the enquiry, the national exchequer has suffered losses as a result of the delay in collecting dues.

The PTA has been asked to provide NAB with information about any pertinent records, court proceedings, and overdue bills. The NAB Karachi has summoned the PTA officials to appear with all pertinent documentation.

All of the principle sum has to be paid by the LDI firms, according to sources. But due to judicial stay orders, the collection of dues has been impeded.

These sources further state that a steering group has been established by the Ministry of IT to supervise the issue of dues recovery.

In a previous event, the tariffs levied on importing cell phones from outside were clarified by the Pakistan Telecommunication Authority (PTA).

Contrary to what some internet reports claim, PTA clarified in response to recent news regarding the tariffs on mobile phone imports that there hasn’t been a formal decision to remove these levies in Pakistan.

the PTA.Pakistanis living abroad will be the only ones free from these levies, according to the PTA. A SIM card can be inserted and the phone restarted to temporarily register a device for non-PTA mobile subscribers.

Business

Weekly inflation in Pakistan increased by 0.17 percent.

Published

18 hours ago

Farwa

The SPI for the week under review in the aforementioned group was reported at 321.95 points, as opposed to 321.40 points during the previous week, according to the PBS statistics.

The SPI for the combined consumption group saw a 20.09 percent increase in the week under review compared to the same week the previous year.

The weekly SPI includes 51 necessary items for every spending group and 17 urban areas, with a base year of 2015–16 = 100.

The SPI for the lowest consumption category, which is up to Rs 17,732, grew by 0.08 percent from 311.97 points to 312.22 points this past week.

0.18 percent,The index of consumption for the lowest consumption groups, which are Rs 17,732-22,888, Rs 22,889-29,517, Rs 29,518-44,175 and above Rs 44,175; increased by 0.13 percent, 0.15 percent, 0.18 and 0.19 percent, respectively.

Nineteen (37.25%) of the fifty-one commodities had price increases over the week, eight (15.69%) had price decreases, and twenty-four (47.06%) had unchanged pricing.

On a weekly basis, the following commodities saw significant price decreases: tomatoes (9.19%), onions (2.14%), LPG (1.04%), bananas (0.53%), wheat flour (0.35%), potatoes (0.17%), pulse masoor (0.16%), and bread (0.05%).

Chicken (4.80%), garlic (2.01%), pulse gramme (1.87%), eggs (1.71%), beef (0.93%), gur (0.89%), pulse moong (0.84%), fresh milk (0.45%), firewood (0.23%), and cigarettes (0.12%) were among the items whose average prices increased significantly week over week.

The commodities that saw a year-over-year decline were: wheat flour (31.75%); cooking oil (13.44%); vegetable ghee 2.5 kg (10.42%); vegetable ghee 1 kg (9.85%); mustard oil (8.33%); eggs (5.82%); rice basmati broken (4.15%); and tea package (2.52%).

Gas prices for Q1 (570.00%), onions (96.01%), pulse gramme (40.39%), powered milk (39.11%), garlic (34.61%), pulse moong (29.77%), men’s sandals (25.01%), beef (23.52%), salt powder (23.28%), pulse mash (22.50%), and energy saver (17.96%) were among the commodities whose average prices increased year over year.

Business

The price of gold has drastically dropped in Pakistan.

Published

2 days ago

Farwa

As per the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the cost of 24-karat gold per tola decreased by Rs 2,300, standing at Rs 250,500.

A kilogramme of 24-karat gold costing Rs1,972 less at the local market, making it worth Rs2114,763. Ten grammes of 22-karat gold had a price decrease to Rs196,866 as well.

After losing a significant $43 during the day, the rate per ounce of gold on the international market also decreased. It currently stands at $2,370.

On Thursday, the price of 24-karat silver also experienced a decline, falling by Rs60 to settle at Rs2,860 petal.