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Express Tribune
20-07-2025
- Business
- Express Tribune
Bourse hits record close near 140k
Listen to article The Pakistan Stock Exchange (PSX) rallied 4,298 points (+3.2% week-on-week) and closed at 138,597, driven by broad-based buying and positive macro developments. The current account recorded a $2.1 billion surplus in FY25, the highest in 22 years, aided by strong remittances. The State Bank of Pakistan's (SBP) foreign currency reserves rose to $14.5 billion, while the Pakistani rupee slipped slightly to 284.87 against the dollar. Gains at the PSX were led by Fauji Fertiliser Company (FFC) and United Bank Limited (UBL) as sentiment improved following Pakistan's engagement with Moody's and the unveiling of a new tariff policy. Sector-specific highlights included a 20% year-on-year (YoY) jump in auto financing and a 2.3% rise in large-scale manufacturing (LSM) output in May. With the market trading at attractive valuations and earnings season underway, investors remain upbeat. On a day-on-day basis, the PSX continued its northbound journey on Monday, with the benchmark KSE-100 index surging 2,203 points to close at an all-time high of 136,502, buoyed by the IMF resident representative's upbeat comments that termed Pakistan's economic recovery "strong so far." However, the market witnessed a day of consolidation on Tuesday, when the index oscillated frequently before closing at 135,940, down 563 points. The consolidation continued on Wednesday as the KSE-100 ended the session at 136,380, up 440 points, after fluctuating in both directions. Bulls returned on Thursday with strength as the bourse surged 2,285 points, driven by robust institutional inflows and investor optimism. Fertiliser stocks led the rally. The PSX ended the week on a volatile note on Friday, with the index briefly crossing the 140,000 mark before slipping to intra-day low of 138,344 (down 322 points). However, it managed to recover and closed almost flat at 138,597, losing just 68 points. Arif Habib Limited (AHL) noted that despite some profit-taking during the week, the market maintained its upward momentum, during which the index climbed from 134,299.8 to 138,597.4. This translated into a strong weekly gain of 4,298 points, or 3.2%. The rally was fueled by broad-based buying across sectors, supported by stabilising macroeconomic indicators. Among the key developments, AHL said, Pakistan's economic team met with Moody's to highlight the improving fundamentals and reaffirm the country's commitment to fiscal reforms. The government also unveiled the National Tariff Policy 2025-30, aimed at rationalising tariffs and enhancing export competitiveness. In sector-specific updates, auto financing increased 20% YoY to Rs277 billion in June 2025, up from Rs231 billion in June 2024. On a month-on-month (MoM) basis, it rose 2%. The LSM index grew 2.3% YoY during May 2025 and surged 7.9% MoM. During 11MFY25, the LSM output decreased 1.2% YoY. Pakistan's current account surplus reached $2.106 billion in FY25, an improvement from the deficit of $2.072 billion during the same period of last year. This marks the highest surplus in 22 years. Meanwhile, the SBP's foreign exchange reserves rose $23 million to $14.5 billion — the highest since March 18, 2022. Pakistani rupee weakened 41 paisa WoW to 284.87 against the dollar, AHL added. JS Global observed that the KSE-100 index extended its bullish run during the outgoing week, gaining 4,298 points, or 3.2% WoW, to close at 138,597. However, average daily turnover declined 20%. The significant surge in the index was primarily driven by FFC (+1,821 points) and UBL (+1,165 points). Sentiment remained positive as the IMF expressed satisfaction with Pakistan's economic progress and structural reform efforts, JS said. Among major news, Pakistan has to repay $23 billion in external debt in the current fiscal year, of which some of the debt is expected to be rolled over by friendly countries. Additionally, the government aims to finalise the privatisation of PIA within two to three months, while Expressions of Interest (EOIs) for Roosevelt Hotel, New York will be invited in August. In the latest Pakistan Investment Bonds (PIBs) auction, Rs342 billion was raised against the target of Rs300 billion, with yields dropping 30-54 basis points across different tenors, JS added in its report.
Business Recorder
16-07-2025
- Business
- Business Recorder
LSM remains stuck in the past
Pakistan's large-scale manufacturing (LSM) sector continues to flirt with the idea of recovery, but the data tells a different story. May 2025 posted a modest 2.29 percent year-on-year increase — the second monthly rise this calendar year — but the bigger picture remains unflattering. Cumulative LSM growth for 11MFY25 stands at negative 1.21 percent, marking the tenth consecutive month of contraction. That's not a recovery; its stagnation dressed up as progress. The rot runs deep. Half of the 22 tracked LSM sub-sectors are still clocking an index value below 100 — meaning their current output is lower than it was nine years ago when the base period began in July 2016. For an economy chasing growth, that's a damning indictment. In fact, the overall LSM index for May 2025, while marginally better than the past two years, is still 5.5 percentage points lower than May 2019, effectively placing industrial activity in a time warp. Let that sink in: Pakistan's industrial engine is idling where it was seven to eight years ago. The diffusion index shows just enough to keep hopes alive — 12 out of 22 sectors have shown year-on-year growth during 11MFY25. But only one of them — automobiles (along with cycles and motorcycles) — managed double digits. The rest are crawling in low single digits, hardly the stuff of revival narratives. The sugar industry has been a major drag, with output down 14 percent year-on-year, producing 5.8 million tons this season, a full 1 million tons short of last year's mark. It's not just sugar either. Juice production — perhaps the most literal measure of industrial vitality — is now at its lowest in 108 months, the worst since the current index base was established. The textile sector remains stuck in a deep freeze. The LSM index for textiles has now stayed below 100 for 36 straight months — that's three years of going nowhere. And the one sub-sector that has kept the LSM numbers from falling off a cliff — readymade garments — is starting to lose steam. While it still contributes positively on a cumulative basis, export quantities have declined year-on-year for several consecutive months, pulling overall momentum down to a modest 5 percent growth. In fact, readymade garments may now be staring down a new test — one shaped by geopolitics. With Trump-era tariffs likely to reshape global trade dynamics again, Pakistan's textile exporters are entering a more competitive world where cost, compliance, and scale will matter more than ever. The sector's trajectory — long the LSM's only bright spot — could now determine whether this entire industrial slide gets arrested or accelerates. Meanwhile, the industrial heavyweights are still in intensive care. Cement, steel, chemicals, and white goods — sectors that traditionally signal broader economic activity — remain deeply negative. And without a rebound in construction-linked industries, any talk of broad-based LSM revival remains wishful thinking. Yes, there are flickers of hope — electric fans, for instance, are seeing some momentum, driven by renewed government focus on energy conservation. But with a sectoral share of just 0.08 in the LSM basket, fans alone are not going to blow wind into the sails of a stalled industrial ship. Policy optimism remains high. Lower industrial electricity tariffs and cheaper credit are being hailed as potential game-changers. But these may only slow the slide, not reverse it. The highs of FY22 are not on the horizon — they are over the hills and far away. The LSM is not dying. But it is certainly not growing up either. It is stuck in industrial adolescence, trapped in a loop of false starts and shallow rebounds. Until the economy confronts its structural bottlenecks — from energy unpredictability to policy inconsistency and export concentration — Pakistan's LSM will continue to do what it does best: take one step forward and two steps back — and call it progress.
Business Recorder
16-07-2025
- Business
- Business Recorder
Economy rescued
EDITORIAL: Prime Minister Shehbaz Sharif, yet again, credited his government with undertaking effective measures to achieve economic stabilization. This claim is fully supported, given that he single-handedly restored the International Monetary Fund (IMF) confidence in his administration's pledge to implement the reform agenda agreed under the 2019 Extended Fund Facility (EFF) programme, reflected by the nine-month 3 billion-dollar Standby Arrangement (SBA) with the Fund in June 2023, that removed all obstacles towards securing the current 36-month-long EFF agreed last year. Attaining stabilisation was of paramount importance, given that the country was facing the looming threat of default attributable to the boom-bust cycle that has periodically characterized Pakistan's economy with imports rising to fuel growth that in turn widens the current account deficit, thereby requiring IMF and donor (bilaterals and multilaterals) injections. It is therefore a singular achievement of his government that from a low of under 3 billion-dollar foreign exchange reserves in February 2023 the country has achieved 14.5 billion dollars as of 4 July 2025. What, however, remains a source of concern is that in spite of a massive rise in remittance inflows (up to 38 billion dollars last fiscal year) the country owes 16 billion-dollar rollovers to friendly countries. It is important to note that Prime Minister also referred to low inflation (from 38 percent Sensitive Price Index to the current 3,81 percent in 2024-25) and a 10 percent decline in the discount rate (from 21 percent in June 2024 to 11 percent in June this year) as positive developments that would impact positively on the general public. Sadly, these two positive developments have yet to filter down to the general public by raising their quality of life or indirectly through raising large-scale manufacturing (LSM) output, which would have a beneficial impact on employment opportunities given that LSM growth was negative 1.52 percent (July-April 2025) against 0.26 percent in the comparable period the year before. The reason for this is the fact that Pakistan's poverty level is on the rise – to 44.2 percent as per the World Bank with unemployment at a high of 22 percent. It is necessary to determine why the feel-good factor is not being widely felt in spite of these two positive developments. Low inflation has not impacted more positively on the general public because the private sector which employs around 93 percent of the country's total labour force has been unable to give a pay raise commensurate to inflation for the past five to six years. This, however, does not apply to the 7 percent who receive their salaries at the taxpayers' expense who have been given an annual raise higher than inflation. And in spite of the reduction in the discount rate it is double that of our regional competitors, which makes local industry uncompetitive. If one adds the input costs of electricity, gas and transport – items whose prices are administered under a rigid upfront IMF programme loan – the negativity in the LSM sector is explained. The Prime Minister further claimed major reforms in the Federal Board of Revenue (FBR); notably, digitization and faceless processing which he stated enabled an additional collection of 500-billion rupees. This too must be appreciated; however, success of the enforcement measures was in relation to existing taxes that are mostly in the indirect mode whose incidence on the poor is greater than on the rich. The Chairman FBR publicly noted the increase in collections in the sugar sector with his critics arguing that the recent rise in sugar prices is partly due to these enforcement measures that were passed onto the consumers and partly due to the flawed government decision to allow exports that led to domestic shortages. That the country is embarked on a reform agenda, which is backed by a reaffirmation by the IMF Resident Representative in Pakistan, is a fact. However, a lot more is required to ensure that the effects of these reforms filter down to the poor and for that the government must slash its current expenditure (to narrow the deficit and reduce reliance on debt) as well as increase the pace of structural reforms, including raising reliance on direct taxes, and improving management while reducing inefficiencies and corruption. Copyright Business Recorder, 2025
Yahoo
15-07-2025
- Business
- Yahoo
LSM launches insurance for EU cryptocurrency entities
Liberty Specialty Markets (LSM) has introduced a new insurance product for financial institutions operating within the European cryptocurrency sector. The product is designed for entities that are compliant with the EU's markets in crypto-assets directive, which provides a regulatory framework for the crypto-asset market in Europe. The coverage includes protection against professional liability, management errors, and the risks of theft and fraud. With coverage limits available up to €3m ($3.5m), the product targets service providers in the cryptocurrency space, including traditional banks, asset managers, and blockchain startups. The launch of this product is a response to the demand from the financial industry, which is currently facing uncertainty influenced by changes in macroeconomic conditions, regulatory environments, and technological developments, such as the advent of digital banking and the rise of cryptocurrencies. LSM Europe head of financial institutions Jorge Chao said: 'The crypto revolution presents significant opportunities, with increasing adoption redefining economic and financial relationships worldwide. The complex risks associated with that are, however, a major strategic issue for financial institutions. 'The product announced today has been meticulously created, working with our cyber and technology teams to close knowledge gaps that can hinder crypto insurance propositions, allowing clients to pursue opportunities in the fast-developing crypto market safely.' The new product extends the reach of current LSM products that include bankers' blanket bonds, professional liability, and directors and officers (D&O) liability. Recently, LSM appointed Benjamin Faerestrand as its UK high net worth (HNW) household underwriter, marking its entry into the HNW insurance market. "LSM launches insurance for EU cryptocurrency entities " was originally created and published by Life Insurance International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. 擷取數據時發生錯誤 登入存取你的投資組合 擷取數據時發生錯誤 擷取數據時發生錯誤 擷取數據時發生錯誤 擷取數據時發生錯誤
Business Recorder
10-07-2025
- Business
- Business Recorder
Defective data yields flawed policies
EDITORIAL: The finance minister has expressed frustration and anger over the formulation of economic policies and decision-making based on outdated data. This has rightly brought the Pakistan Bureau of Statistics (PBS) into the spotlight. Its officials must be held accountable. The controversy began with strong criticism — including from this publication — of the flawed GDP growth figures, where PBS estimated over 5 percent growth in the last quarter of FY25 on an utterly unjustified basis. Additionally, the poverty and employment data are outdated, while the government's estimates significantly diverge from those of the World Bank and independent economists. There are clear indications of an attempt to overstate GDP growth in FY25. A prime example is livestock, which accounts for nearly two-thirds of agriculture. While important crops are declining by 13.5 percent, PBS estimates livestock growth at 4.8 percent. However, the last livestock survey was conducted in 2005-06. A new survey, originally scheduled for completion in FY21, has faced repeated delays and remains incomplete. When questioned, the chief statistician absurdly blamed political uncertainty for the five-year delay. He then tried to justify the livestock growth figures based on annual fodder consumption. But how can fodder consumption grow at such high rates when fodder crop production is declining? According to the methodology published on the PBS website, livestock estimates are derived using 2015-16 constant prices, factoring in natural growth and regeneration. Yet, neither the growth figures nor the PBS's explanations make sense. There are other notable discrepancies as well. For instance, in the industrial sector, Small-Scale Manufacturing (SSM) is reported to have grown by 8.8 percent, whereas Large-Scale Manufacturing (LSM) declined by 1.5 percent. How can SSM grow when the downstream segment – LSM — is shrinking? That is akin to saying auto parts assemblers are booming while car production and sales are falling. The math simply does not add up. Similarly, the construction sector is estimated to have grown by 6.6 percent, while its proxy indicator — local cement dispatches — is down by 3 percent. PBS justifies this by assuming full utilisation of the budgeted Public Sector Development Programme (PSDP), which is implausible given the government's push for a primary fiscal surplus. PSDP was in fact severely underutilised in 9MFY25, a fact known at the time PBS released the growth data. Another glaring example is the electricity, gas, and utility sector, which PBS claims grew by 29 percent — implying over 100 percent growth in the last quarter alone. However, NTDC (National Transmission and Dispatch Company) data shows that power generation fell by 0.3 percent in 11MFY25. Meanwhile, a reported 10 percent growth in public administration and social security is also questionable when current expenditure is stagnating in real terms. It appears there was a deliberate effort to overstate GDP growth by PBS, which operates under the Planning Ministry. Now, the finance minister is publicly criticising them. It is a compelling need to reform PBS and restore the integrity of national data. The flaws at PBS extend well beyond GDP estimates. Serious doubts persist around other indicators such as household income, unemployment, poverty, and population data — all of which directly influence socioeconomic policymaking. PBS suffers from serious capacity issues. Though it is supposed to function autonomously — like the State Bank of Pakistan. However, it lacks depth and independence. The current chief statistician appears arrogant and defensive, often justifying clear errors. This is too critical a position to be handled so carelessly. The government must take notice. Competent professionals with integrity and independence must be appointed to ensure that both public and private sectors receive accurate data to support informed decision-making. Copyright Business Recorder, 2025
