Latest news with #StateBankofPakistan
Business Recorder
an hour ago
- Business
- Business Recorder
0.01pc decline
KARACHI: Rupee depreciated against the US dollar during the previous week as it lost Re0.04 or 0.01% in the inter-bank market. The local unit closed at 282.02, against 282.06 it had closed the week earlier against the greenback, according to the State Bank of Pakistan (SBP). A rise in import demand has put pressure on the local currency, according to analysts. Meanwhile, the foreign exchange reserves held by the State Bank of Pakistan (SBP) increased by $70 million on a weekly basis, clocking in at $11.52 billion as of May 23, data released on Thursday showed. Total liquid foreign reserves held by the country stood at $16.64 billion. Net foreign reserves held by commercial banks stood at $5.12 billion. The central bank did not attribute any reason to the increase in the FX reserves. Open-market rates In the open market, the PKR lost 25.00 paisa for buying and 40.00 paisa for selling against USD, closing at 282.90 and 284.15, respectively. Against Euro, the PKR lost 4.56 rupees for buying and 4.30 rupees for selling, closing at 320.52 and 322.86, respectively. Against UAE Dirham, the PKR lost 15.00 paisa for buying and 10.00 paisa for selling, closing at 77.14 and 77.55, respectively. Against Saudi Riyal, the PKR lost 22.00 paisa for buying and 15.00 paisa for selling, closing at 75.48 and 77.85, respectively. ========================================= THE RUPEE ========================================= Weekly inter-bank market rates for dollar ========================================= Bid Close Rs. 281.97 Offer Close Rs. 282.17 Bid Open Rs. 281.66 Offer Open Rs. 281.86 ========================================= Weekly open-market rates for dollar ========================================= Bid Close Rs. 282.90 Offer Close Rs. 284.15 Bid Open Rs. 282.65 Offer Open Rs. 283.75 ========================================= Copyright Business Recorder, 2025
Business Recorder
an hour ago
- Business
- Business Recorder
FDI in Pakistan: Optimism amid constraints
Foreign Direct Investment (FDI) has long been a weak link in Pakistan's economic progress. While there has been no substantial improvement in inflows—annual FDI has remained below $2 billion on average—the State Bank of Pakistan's latest State of the Economy report presents a cautiously optimistic view of FDI trends and prospects. According to the central bank, the current FDI landscape and outlook reflect several key dynamics. The report notes significant investment inflows primarily in sectors such as power (hydel and coal), financial services (including microfinance and investment banks), and oil and gas exploration. However, it also acknowledges that these inflows remain heavily concentrated in traditional sectors, with China continuing to play a significant role—particularly in power generation infrastructure and consumer electronics. While the report highlights that major FDI sources include the Middle East, the UK, the US, and Hong Kong—targeting long-term growth sectors like renewable energy and consumer electronics manufacturing—monthly SBP data does not reflect noticeable spikes in overall inflows. Similarly, while the ICT sector is portrayed as a bright spot due to consistent growth and supportive policy measures, FDI into the sector remains small in real terms. Despite these positive developments, challenges persist. The central bank's half-yearly report underlines the need to diversify FDI beyond conventional sectors. It also points to increasing profit repatriation, which places pressure on the financial account, and highlights that official loan disbursements continue to fall short of commitments—further constraining financial inflows. The central bank links sustainable FDI inflows to long-term improvements in competitiveness, particularly those rooted in productivity, policy stability, and institutional quality – something that has been missing in Pakistan. The document advocates a strategic shift from short-term cost advantages to deeper reforms that create an enabling environment for high-quality, diversified, and durable foreign investment. Looking ahead, the SBP maintains a cautiously optimistic stance on FDI. The ICT sector, buoyed by ongoing support from the government and central bank, is expected to maintain its growth trajectory, contributing to export expansion and attracting global investment. Infrastructure development, especially in renewable energy and power transmission, is likely to continue drawing interest from strategic partners such as China. Moreover, improved macroeconomic stability, declining global interest rates, and more favourable global financial conditions could support greater FDI inflows in the short to medium term. That said, risks tied to global economic trends, domestic political stability, policy continuity, and external debt repayment obligations remain significant. In a recent engagement with international investors, the Governor of the State Bank presented a more upbeat picture of Pakistan's macroeconomic outlook. Investors were told that the outlook for FDI is positive, driven by prudent monetary policy, consistent fiscal consolidation, and improving inflation dynamics. The Governor emphasized the strengthening of foreign exchange reserves without reliance on additional external debt—highlighting this as a key marker of sustainable fiscal management. He also pointed to the gradual recovery in GDP growth and recent upgrades by international credit rating agencies as signs of renewed investor confidence. With a continued focus on structural reforms aimed at fostering long-term economic stability, the Governor portrayed a scenario in which ongoing economic improvements, stronger external accounts, reduced debt burdens, and international recognition enhance Pakistan's prospects for attracting and sustaining FDI in the near to medium term. However, a closer comparison of the SBP report and the Governor's remarks reveals notable some differences in tone and emphasis. While the Governor's statement highlights the build-up of external buffers independent of external debt—casting debt sustainability in a favourable light—the SBP report takes a more measured view. It directly addresses the financial pressures arising from reduced official inflows and significant external debt repayment obligations. Although these perspectives are not inherently contradictory, they differ in tone and depth. The SBP report presents a balanced assessment, acknowledging both strengths and vulnerabilities, while the Governor's remarks are more optimistic, focusing on macroeconomic gains and reform momentum.
Express Tribune
2 days ago
- Business
- Express Tribune
SadaPay's Turkish owner faces money laundering probe
Listen to article Papara — a Turkish financial technology company that acquired Pakistan's leading fintech SadaPay in May 2024 — is currently under investigation by Turkish authorities for alleged involvement in money laundering, illegal betting, and other financial crimes. The company's founder and CEO, Ahmed Faruk Karsl?, has been detained along with 12 others as part of a sweeping law enforcement operation. According to a report by the Istanbul Chief Public Prosecutor's Office confirmed that Karsl? was taken into custody during coordinated early morning raids across Istanbul. Authorities have seized a wide range of assets linked to the suspected criminal network, including eight businesses under PPR Holding Inc., multiple properties, luxury vehicles, yachts, and cryptocurrency wallets. The investigation, supported by data from the Central Bank of the Republic of Turkey (CBRT), the Financial Crimes Investigation Board (MASAK), and other regulatory bodies, revealed that Papara's platform was allegedly used to facilitate illegal financial transactions. Investigators found that 102 of the 26,012 user accounts created through Papara's technology were directly involved in high-volume illegal betting and fund transfers. These transactions were routed through 274 different bank accounts and eventually funneled into 16 cryptocurrency wallets as part of an elaborate money laundering scheme. Turkish Interior Minister Ali Yerlikaya stated that 13 individuals have been detained and that assets of the companies and suspects involved have been frozen. The financial crimes unit estimates that the illicit transactions amounted to over 12.9 billion Turkish lira (approximately $330 million). Papara, which reportedly has over 21 million users and a valuation exceeding $2 billion, acquired Pakistan-based SadaPaya licensed Electronic Money Institution (EMI) regulated by the State Bank of Pakistan — exactly one year ago. However, Pakistani authorities have not yet reported any links between the Turkish investigation and SadaPay's operations in Pakistan. Industry experts believe that the developments in Turkey necessitate a careful review by Pakistani regulators. A fintech analyst Muhammad Yasir urged the State Bank of Pakistan (SBP) to closely monitor local fintech operators associated with foreign sponsors. "This case highlights the need for enhanced regulatory oversight and continuous due diligence," noted Yasir, adding, "While the allegations pertain to activities in Turkey, the reputational impact on SadaPay is inevitable. SBP must re-evaluate its existing EMI regulations and adopt a proactive approach to managing cross-border financial risks." He added that as financial technologies evolved and cyber-financial crimes grew increasingly sophisticated, Pakistan's regulatory framework must be regularly updated to safeguard consumer interests and the integrity of the national financial system.
Express Tribune
2 days ago
- Business
- Express Tribune
SBP injects Rs1.15tr to stabilise markets
Listen to article The State Bank of Pakistan (SBP) conducted a major liquidity injection on Friday, deploying a total of Rs1.148 trillion into the banking system through a mix of conventional and Shariah-compliant open market operations (OMOs). Under the conventional reverse repo facility, SBP injected Rs970 billion, including Rs250 billion for a 6-day tenor at 11.10% and Rs720 billion (partially accepted) for a 14-day tenor at 11.08%. Simultaneously, the Shariah-compliant Mudarabah OMO contributed Rs178 billion, split almost evenly between 6-day and 14-day tenors, both priced at 11.10%. This Rs1.15 trillion operation is among the largest single-day liquidity injections this year, signalling the SBP's proactive approach to maintaining stability in the interbank market amid tight liquidity conditions. Meanwhile, the Pakistani rupee posted a marginal gain against the US dollar in the interbank market, appreciating by 0.02% on Friday. By the end of the trading session, the local currency closed at 282.02, up by five paisas from Thursday's closing rate of 282.07. According to Ismail Iqbal Securities, the rupee has depreciated by 1.23% on a calendar year-to-date (CYTD) basis and by 1.30% on a fiscal year-to-date (FYTD) basis. On the commodities front, gold prices in Pakistan declined on Friday, reflecting losses in the international market. The fall came as the US dollar gained strength and investors responded to recent tariff announcements. However, a softer US inflation report sustained hopes of a possible interest rate cut. According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of gold dropped by Rs700 per tola, settling at Rs348,600, while the rate for 10 grams decreased by Rs599 to Rs298,868. Adnan Agar, Director at Interactive Commodities, said the market remains range-bound. "Gold hit a high of $3,322 and is trading around $3,290, with strong support at $3,260," he noted, adding that, "Unless the price breaks above $3,340$3,350, downward pressure is likely to continue."
Business Recorder
2 days ago
- Business
- Business Recorder
No legal framework exists: FIs must avoid deals involving VAs: SBP
KARACHI: The State Bank of Pakistan (SBP) on Friday said it has directed financial institutions to refrain from engaging in transactions involving Virtual Assets (VAs), citing the lack of a legal and regulatory framework governing such activities. With reference to the news items regarding the 14th meeting of the National Assembly's Standing Committee on Finance and Revenue, SBP has clarified, in 2018 SBP advised its regulated entities including Banks, Development Finance Institutions (DFIs), Microfinance Banks (MFBs), Electronic Money Institutions (EMIs), Payment System Operators (PSOs), Payment Service Providers (PSPs), and Exchange Companies to avoid dealing in Virtual Assets (VAs) due to the absence of any legal and regulatory framework for the VAs; not because it was declared illegal in the country. SBP, Finance ministry inform NA body: 'Cryptocurrency is not legal in Pakistan' This was done to protect its regulated entities and their customers from the risks emanating due to the absence of legal and regulatory framework for VAs in the country, the SBP said. The SBP and Finance Division are currently engaged with the Pakistan Crypto Council established by the Federal Government for, among others, developing an appropriate legal and regulatory framework for VAs in Pakistan, it added.'We understand that the legal and regulatory framework would provide the requisite clarity and legal coverage about the VAs ensuring consumer and investor protection,' the SBP concluded. Copyright Business Recorder, 2025
