PSX goes up by 1062 points in a day after dollar price cap removal

Currently Pakistan is in talks with International Monetary Fund (IMF) for continuation and revival of a previously on going bail out loan program. However, for this time IMF had about four conditions for Pakistan to meet, before the loan program go further. As the Pakistan’s economy is not doing well and foreign reserves are dropping, so Pakistani government had recently decided to accept the conditions of IMF. Along with increasing the gas & electricity prices and increasing taxes, one of IMF condition demanded Pakistan to not control the Rupee and US Dollar exchange rate artificially. As US Dollar was artificially being kept below 225 in interbank and open markets while in black market it was being sold as high as […]

Govt agrees to accept IMF demands including electricity & Gas price increase

There was an on going deadlock between Government of Pakistan and the International Monetary Fund (IMF) on disbursement of next iteration of funds to Pakistan due to four demands of IMF. As after the floods and the political instability Pakistan’s economic situation got worse, so IMF thought until and unless Pakistan takes some more measures to collect funds, it will not go forward with disbursement of next over one billion US dollar funds. Government first has been hesitant on accepting the different action items on the IMF’s demand list but after the foreign reserves got dangerously low and other lenders have linked their lending process to IMF’s fund disbursement, govt of Pakistan left with no other option to accept the […]

Remittances down and imports curbed in Pakistan

In December 2022 total inflow of remittances through the official channels stood at $2 billion, which is 19 percent decline from last month. This is due to the disparity between the official price of US Dollar (the interbank rate) and the price in open market. As in open market you can trade your dollars in much more money, people are adopting to use the unofficial channels more to send in their remittances. This not only take away the government’s opportunity to charge tax on money sent in but also the inflow is not properly added to foreign exchange available to state bank and other government owned bodies. The disparity between the official interbank rate and the open market is due […]