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Gulf Today
a day ago
- Business
- Gulf Today
Pakistan's current account surplus hit a 22-year high of $2.1 billion
Pakistan's Prime Minister Muhammad Shehbaz Sharif hailed the increase of current account surplus to $2.1 billion in fiscal year 2024-2025. In a statement, he said current account surplus had reached the highest level in last 22 years which was a very positive development. 'Due to government measures, foreign exchange reserves have crossed $19 billion,' he added as quoted by APP. The prime minister said the main reason for stability in current account surplus was significant increase in remittances and exports, adding with every passing day, improving financial and economic indicators showed that the country's economy was on the path of stability. 'The government is taking priority steps to further improve the business and investor friendly environment in the country,' he remarked. He said: 'The efforts of the government's economic team are commendable.' Meanwhile Pakistan's consumer price inflation rose 3.2 per cent year-on-year in June, the statistics bureau said on Tuesday, broadly in line with the finance ministry's projection of 3 per cent to 4 per cent issued a day earlier. On a month-on-month basis, prices increased 0.2 per cent in June, reversing a 0.2 per cent decline in May. The data comes after Pakistan's central bank kept its key interest rate unchanged at 11 per cent in June. The State Bank of Pakistan (SBP) said in its latest monetary policy statement that inflation was expected to show some near-term volatility but gradually stabilise within the 5 per cent to 7 per cent target range. The figures also come weeks after Pakistan unveiled its annual budget, which included new revenue measures and subsidy cuts as part of efforts to secure a long-term loan programme from the International Monetary Fund (IMF). Analysts have warned that higher energy and tax costs could stoke inflation in the second half of the year. Pakistan's stock exchange rose 2.3 per cent on the day to close at an all-time high of 128475.7 points, on Tuesday, the first day of the new fiscal year. Meanwhile last week the Government of Pakistan and the Asian Development Bank (ADB) on Tuesday signed a $350 million loan agreement for the 'Women Inclusive Finance Sector Development programme (Subprogram-II),' aimed at strengthening women's access to finance and advancing gender-inclusive economic development. According to the Associated Press of Pakistan (APP), which cited a press release issued by the Economic Affairs Division, the agreement was signed by Sabina Qureshi, Additional Secretary of the Economic Affairs Division, and Dinesh Raj Shiwakoti, Head of the Project Administration Unit at ADB. The State Bank of Pakistan signed the Project Agreement for the Financial Intermediary Loan. This agreement reflects the Government of Pakistan's continued commitment to empowering women economically by expanding access to financial resources, encouraging entrepreneurship, and generating employment opportunities. The initiative is designed to promote a more inclusive and sustainable economic future for women across the country. Subprogram II builds on the foundational policy reforms introduced under Subprogram I and focuses on four strategic areas. These include establishing a supportive policy and regulatory framework for women's financial inclusion; increasing the availability of financial resources tailored for women; strengthening the entrepreneurial skills and capabilities of women; and fostering inclusive and equitable workplace environments within the financial sector. Meanwhile Pakistan has been ranked among the world's top emerging economies following a significant drop in its default risk in a major boost to investor sentiment and international credibility. According to a new report by the globally renowned financial data agency Bloomberg, Pakistan's probability of default has declined from 59 per cent to 47 per cent over the past 12 months — a notable improvement of 1100 basis points. The report highlights Pakistan's growing economic stability and successful financial reforms as key factors behind this improvement. Bloomberg attributes the positive shift to enhanced investor confidence, improved foreign exchange reserves, successful negotiations with the International Monetary Fund (IMF), and increased efforts to boost revenue through domestic reforms. Pakistan's inclusion at the top of Bloomberg's list of emerging economies reflects a strong endorsement of the government's recent economic measures. The report states that credit rating upgrades and strengthened relations with international financial institutions have contributed to a more stable outlook, encouraging global investors to re-engage with Pakistan. Agencies
New Indian Express
a day ago
- Business
- New Indian Express
Pakistan records annual current account surplus of USD 2.1 bn, PM Shebaz hails it as 'sign' of development
ISLAMABAD: Pakistan recorded a current account surplus of USD 2.1 billion during the current fiscal year ending June 30, according to official data. Prime Minister Shehbaz Sharif hailed the development as a sign of an improving economy. The country faced a perennial issue of balance of payment and periodically rushed to the International Monetary Fund and other financial institutions to get monetary support. The latest data of the State Bank of Pakistan (SBP) on Friday showed the current account surplus was recorded at USD 2.1 billion, compared to a deficit of USD 2.1 billion during the previous fiscal year. It was apparently achieved following a strict policy to discourage unnecessary imports of luxury items, which were a drain on the current account. Other factors included encouraging remittances by expats and promoting exports of traditional and IT-related items. Adviser to the Finance Minister Khurram Schehzad took to X to announce that the surplus was the highest in 22 years. [The] country's current account for June 2025 closes in a USD 328m surplus, taking the full-year surplus to over USD 2.1bn, he wrote. Schehzad added that remittances surged by 27 per cent year-on-year to reach a historic USD 38 billion.
Express Tribune
a day ago
- Business
- Express Tribune
REER improves to 96.6 in June
Listen to article The Real Effective Exchange Rate (REER) index for the Pakistani rupee improved to 96.6 in June 2025, down from 97.8 in May 2025, according to data released by the State Bank of Pakistan (SBP). The drop in REER suggests improved external competitiveness for the rupee. The rupee also appreciated slightly against the US dollar on Friday, gaining 0.04% in the interbank market. It closed at 284.87, up by 10 paisas from Thursday's closing rate of 284.97. In parallel, the SBP injected Rs11.05 trillion into the banking system through Open Market Operations (OMOs) on Friday, using both conventional and Shariah-compliant instruments. The bulk came through the conventional reverse repo OMO, with Rs11.371 trillion accepted. Most of this was in the 14-day tenor (Rs11.2 trillion at 11.03%), and a smaller portion in a 7-day tranche (Rs171.1 billion at 11.09%). Under the Shariah-compliant Mudarabah-based OMO, Rs115.5 billion was accepted, split between 7-day (Rs100 billion at 11.11%) and 14-day (Rs15.5 billion at 11.13%) tenors. These operations reflect SBP's focus on short-term liquidity management. Rates ranged from 11.03% to 11.13%, suggesting stable interbank market conditions. The pro-rata acceptance in some tenors points to selective liquidity control to balance market needs. Analysts view the scale of the injection as a sign of adequate banking liquidity. The slightly lower OMO rates may signal a shift towards monetary easing. Meanwhile, the APGJSA, said the price of gold per tola rose by Rs2,500 to Rs357,600 on Friday. The price of 10 grams increased by Rs2,143 to Rs306,584. A weaker US dollar and geopolitical uncertainty boosted gold's appeal as a safe-haven asset. Platinum prices, however, retreated after recently hitting a decade high.
Business Recorder
a day ago
- Business
- Business Recorder
C/A posts surplus of over $2bn after 14 years
KARACHI: Pakistan's current account balance recorded a surplus of over 2 billion dollars in the last fiscal year (FY25) for the first time in 14 years, driven by a substantial increase in workers' remittances. The State Bank of Pakistan (SBP) on Friday reported that Pakistan has achieved a current account surplus of $2.1 billion in FY25 as against a deficit of $2.1 billion in the previous year (FY24). Khurram Schehzad, Advisor to the finance minister, has said that annual current account surplus has been recorded after a gap of 14 years, and the largest surplus in 22 years. He termed it a key development on the external front of Pakistan's economy, adding that the overall economic performance is encouraging and the country is on the right track due to appropriate policy measures. Monthly basis, the current account balance for the last month (June) of FY25 also posted a surplus of $328 million, compared to deficit of $500 million in June 2024. In addition, current statistics of June 2025 are also better than May 2025, in which the country posted $84 million deficit. Economists attribute this improvement to robust policy measures and consistent efforts by the federal government and the SBP to strengthen the external account and channel remittances through formal avenues. They said that all time high inflows of remittances is the major factor was behind the current account surplus in the last fiscal year. 'The remarkable shift was primarily fuelled by a sharp rise in workers' remittances, which provided crucial support to the external account,' they added. In a historic economic milestone, with a significant 27 percent growth, Pakistan recorded its highest-ever home remittance inflows, exceeding $38 billion during the last fiscal year FY25. According to SBP, Pakistan's trade deficit widened by $4.6 billion to $26.78 billion in FY25, compared to $22.18 billion in FY24. The increase was primarily driven by a higher import bill amid a pickup in economic activity. During the period under review, import bill increased by 11 percent to $59 billion from $53 billion. Exports also posted 4 percent or $1.295 billion growth to reach $32.295 billion in FY25 from $31 billion in FY24. Khurram Schehzad said that Real Effective Exchange Rate (REER) index has also dropped further to 96.6, rendering PKR more competitive against US$, which should support country's exports and keep external account in check. In addition, Pakistan Stock Market continues to be in the top Global rankings, currently 4th best globally Jul-25 to date, he said and added that on Friday Pakistan Equities Market (KSE-100) also crossed 140,000 points during the intraday trading, making a historic mark in its history, with market value crossing Rs 16.8 trillion (close to $60bn). Copyright Business Recorder, 2025
Business Recorder
a day ago
- Business
- Business Recorder
June C/A closes with $328m surplus: advisor
ISLAMABAD: Khurram Shahzad, adviser to the finance minister said that country's Current Account (CA) for June 2025 closes in $328 million surplus, taking full-year surplus to over $2.1 billion —annual surplus recorded after 14 years, and the largest surplus in 22 years. He further said that Real Effective Exchange Rate (REER) index has dropped further to 96.6, rendering PKR more competitive against US$, which should support country's exports and keep external account in check. Pakistan Equities Market (KSE-100) crossed 140,000 points, making a historic mark in its history, with market value crossing Rs16.8 trillion (close to $60 billion), he added. Separately, former caretaker minister Gohar Ejaz said the country is on track for positive economic development and growth, and any attempt to manipulate the exchange rate by any segment must be strongly resisted, as it would risk undoing three years of hard-earned economic stabilisation efforts. 'In June, the Real Effective Exchange Rate (REER) stood at 96.61, indicating that the Pakistani rupee is currently undervalued. It is essential to maintain a market-based exchange rate to preserve macroeconomic progress. The country is on track for positive economic development and growth, and any attempt to manipulate the exchange rate by any segment must be strongly resisted, as it would risk undoing three years of hard-earned economic stabilization efforts', Ejaz stated. He said that the State Bank of Pakistan (SBP) must continue to maintain positive real interest rates in accordance with the International Monetary Fund (IMF) agreement and basic economic principles. However, the current policy rate is 11 percent, while full-year inflation for 2025 stands at 4.6 percent. Maintaining a policy rate that is 6.4 percentage points above inflation lacks sound economic justification, he added. Copyright Business Recorder, 2025
