Welcome to our weekly economic roundup, where we delve into the pulsating heart of Pakistan’s financial and economical landscape. This week, we’ve witnessed some interesting movements across various sectors, so let’s dive just right in!

PKR AND PSX MOVEMENTS

Starting with the currency market, the Pakistani Rupee (PKR) saw a slight adjustment in the InterBank exchange rate, hovering around 279.59 to the US Dollar, a marginal shift from last week’s 279.89. Keeping our eyes on the stock market, the KSE100 Index, a barometer of Pakistan’s economic health, showed robust growth, climbing to 63,813.06 from 63,282.23. This uptick reflects investor confidence and market resilience.

In the bustling world of commodities, the average daily trading volume painted a picture of increased activity, jumping to over 415 million from the previous week’s 388 million. Meanwhile, gold enthusiasts in Karachi observed a slight dip in prices, with 10 grams of gold now priced at 183,642 PKR, down from 184,328 PKR.

Interest rates, a key indicator of economic health, showed nuanced movements. The Karachi Inter-Bank Offered Rate (KIBOR) for 6 months recorded a tiny dip to 20.67%, and the yield on 10-Year Pakistan Investment Bonds (PIBs) followed suit, easing to 14.23%.

The Pakistani currency exchange presented a mixed bag. While the US Dollar in the open market edged up to 281.17 PKR, the Euro and British Pound held steady, reflecting global economic dynamics.

POLICY RATES AND EXCHANGE RATES

Shifting our focus to government securities, the latest T-Bill auction saw a slight decrease in yields across the board, indicating a cautious but optimistic market sentiment. Similarly, the PIB auction results reflected this trend with a downward adjustment in yields.

The State Bank of Pakistan (SBP), in its pursuit of economic stability, maintained its policy rate at 22.00%, a stance reflecting its commitment to balanced economic growth. Monetary Policy meeting due on January, 29, 2024.

In the weekly snapshot, foreign exchange reserves showed a modest increase, with the SBP’s reserves jumped to 8,270.50 million USD, a reassuring sign of financial stability.

On the monthly front, the Consumer Price Index (CPI) inched up to 255.24, pointing to a continued watch on inflation. The Wholesale Price Index (WPI) and Sensitive Price Indicator (SPI) followed similar trends, underscoring the ongoing focus on price levels.

Pakistan’s trade dynamics presented a challenging picture, with exports at 2,822.00 million USD against imports of 4,650.00 million USD, highlighting the trade deficit concerns. However, the silver lining appeared in the form of robust home remittances and foreign investments, signaling confidence in Pakistan’s economic potential.

In the larger context, the annual indicators painted a mixed portrait of Pakistan’s economy. While the GDP growth rate showed a contraction at -0.17%, sectors like agriculture and services indicated resilience. The budget deficit and total debt, however, remain areas of focused attention.

The economic data for this week, in summary, presents a balanced perspective of opportunities and challenges in Pakistan’s financial environment. Follow along for more details on Pakistan’s changing economic journey as we continue to monitor these trends.

DATA IN NUMBERS 

I. CURRENCY AND STOCK MARKET MOVEMENTS

In this section, we dissect the recent fluctuations in Pakistan’s currency and stock markets.

PKR InterBank Rates: A Closer Look at PKR’s Performance

  • Jan 26, 2024: 279.5937 PKR/USD
  • Jan 19, 2024: 279.8961 PKR/USD

KSE100 Index: Gauging Economic Health

  • Jan 26, 2024: 63,813.06
  • Jan 19, 2024: 63,282.23

Avg Daily Trading Volume: A Sign of Market Activity

  • Jan 26, 2024: 415,581,092 shares
  • Jan 19, 2024: 388,799,358 shares

Gold Prices (Karachi): A Glint of Change

  • Jan 26, 2024: 183,642 PKR/10 gm
  • Jan 19, 2024: 184,328 PKR/10 gm

II. INTEREST RATES AND EXCHANGE RATES

Here, we explore the dynamics of interest rates and currency exchange rates.

KIBOR 6M: Interest Rate Movements

  • Jan 26, 2024: 20.67%
  • Jan 19, 2024: 20.69%

10Y PIB Yield: Bond Market Insights

  • Jan 26, 2024: 14.23%
  • Jan 19, 2024: 14.27%

USD Exchange Rate: USD’s Fluctuations

  • Jan 26, 2024: 281.17 PKR/USD
  • Jan 19, 2024: 280.98 PKR/USD

III. GOVERNMENT SECURITIES AND SBP POLICIES

This section delves into the performance of government securities and the State Bank of Pakistan’s policies.

T-Bill Auction Cutoff Yield: A Glimpse into Debt Markets

  • Jan 24, 2024: 3M – 20.4997%, 6M – 20.4000%, 12M – 20.2298%

PIB Auction Cutoff Yield: A Look at Long-Term Bonds

  • Jan 16, 2024: 3Y – 16.8000%, 5Y – 15.5000%, 10Y – 14.5000%

SBP Interest Rate Corridor: Monetary Policy Insights

  • Jun 27, 2023: SBP Policy Rate – 22.00%, SBP Reverse Repo Rate – 23.00%, SBP Repo Rate – 21.00%

IV. RESERVES AND ECONOMIC INDICATORS

This section provides an overview of foreign exchange reserves and key economic indicators.

FX Reserves: A Window into Financial Stability

  • SBP FX Reserves (Jan 25, 2024): $8,270.50 million
  • Bank FX Reserves (Jan 25, 2024): $5,070.90 million
  • Total FX Reserves (Jan 25, 2024): $13,341.40 million

Sensitivity Price Indicator (SPI): Tracking Inflation

  • Jan 25, 2024: 318.55
  • Jan 18, 2024: 319.00

V. MONTHLY AND ANNUAL ECONOMIC DATA

This section provides insights into monthly and annual economic data.

Consumer Price Index (CPI): Inflation Trends

  • December: 255.24 (Change – MOM: 0.82%, Change – YOY: 29.66%)
  • November: 253.15 (Change – MOM: 2.70%, Change – YOY: 29.23%)

WholeSale Price Index (WPI): Wholesale Market Insights

  • December: 306.05 (Change – MOM: -0.02%, Change – YOY: 27.33%)
  • November: 306.10 (Change – MOM: 1.44%, Change – YOY: 26.44%)

Trade Balance: Exports, Imports, and the Balance

  • December: Exports – $2,822.00 million, Imports – $4,650.00 million, Trade Balance – -$1,828.00 million

Home Remittances: Remittances on the Rise

  • December: $2,381.49 million
  • November: $2,258.54 million

Foreign Investment: A Boost to the Economy

  • December: $243.33 million
  • November: $155.96 million

Current Account Balance: A Changing Picture

  • December: $397.00 million
  • November: -$15.00 million

REER Index: Real Effective Exchange Rate

  • December: 98.8646 (Change – MOM: 0.60%, Change – YOY: 1.43%)
  • November: 98.2755 (Change – MOM: -0.24%, Change – YOY: -2.03%)

VI. QUARTERLY AND ANNUAL ECONOMIC PERFORMANCE

In this section, we provide a broader view of Pakistan’s economic performance.

Pakistan’s External Debt: A Growing Challenge

  • Sep 30, 2023: $128,091.00 million
  • Jun 30, 2023: $124,593.00 million

Annual Indicators: A Yearly Overview

  • FY23 GDP Growth Rate: -0.17%
  • FY23 Agriculture Sector Growth: 2.25%
  • FY23 Manufacturing Sector Growth: -5.29%
  • FY23 Services Sector Growth: 0.07%
  • FY23 Budget Deficit (As % of GDP): -7.70%
  • FY23 Total Debt & Liabilities (As % of GDP): 91.10%
  • FY23 Total Debt & Liabilities (Rs. Billion): 77,104.10
  • FY23 Trade Balance (July – June): -$27,547.00
  • FY23 Worker Remittances (July – June): $27,027.63
  • FY23 Foreign Investment (July – June): $429.67
  • FY23 Current Account Balance (July – June): -$2,387.00
  • FY23 Annual Inflation Rate % (July – June): 29.18%

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