November 25, 2018 (MLN): The highlight of the departed week was the extension in Pak-IMF bailout talks as a result of their failure to reach a mutual agreement. The Pakistani government refused to accept most of the demands pronounced by the Fund, including increment in GST and interest rates.
However, the market sentiments were optimized as Pakistan received $1 billion from Saudi Arabia, as the first installment of the $3 billion bailout package. Due to this, SBP’s reserves stand at $8,293.9 million and total liquid foreign reserves at $14,722.4 million.
The stock markets on the other hand suffered a blow of over 750 points, amidst all the negative sentiments, resulting in the KSE -100 index to slip beyond 41,000-point mark, currently standing closed at 40,869.
Events of Importance through the Week:
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The week began with the news of Pakistan’s foreign exchange reserves increased by $1 bln on the back of the receipt of the tranche worth $1 billion from Saudi Arabia, under a financial assistance package.
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On fiscal front, Pakistan posted a fiscal deficit of 1.4% of the GDP during the first quarter of fiscal year 2019, compared with 1.2% in 1QFY18. This increase in fiscal deficit is due to the relatively slower growth in revenues compared with expenditures.
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PBS released the Weekly Sensitive Price Index (SPI) figures according to which, the Weekly Sensitive Price Index (SPI) for the combined group has slightly edged up by 0.08% over the week ended November 15, 2018.
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Due to lack of interest, foreign investors limited their purchase significantly during the week ended November 16, 2018, as net selling sprung back to over Rs.1.8 billion from Rs.509 million recorded a week earlier.
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Moreover, Pakistan's over-all output of LSMI decreased by 1.71% for July-September 2018-19 compared to July-September 2017-18. The decline in overall production is attributable to decrease in production of Food, Beverages & Tobacco, Coke & Petroleum Products, Pharmaceuticals, Non-Metallic Mineral Products and Fertilizers
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Oil prices fell to their lowest in a year on Friday, weighed down by worries over excess supply and tepid demand amid global economic uncertainty. The benchmark US contract, West Texas Intermediate for January delivery, dropped $4.21 to $50.42 a barrel in a holiday-shortened session, a decline of 7.7 percent and the lowest level in more than a year.
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The week ended with the news of Mr. Arif Usmani has been appointed as a new president of National Bank of Pakistan (NBP).
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