July 17, 2023 (MLN): Pakistan Euro Bonds worth $1 billion, maturing in April 2024 have appreciated by 46% to 82.5 cents in the last three weeks after the agreement with IMF was reached on June 29, 2023.
Euro bonds worth $500 million, maturing in September 2025, rose by 49% to 65.2 cents.
Moreover, Eurobonds worth $1.3bn, maturing in April 2026 improved by 41% to 56.7 cents.
The appreciation during these three weeks was supported by several events that restored investors’ confidence:
Foreign Exchange Inflows
The IMF board approved the 9-month Stand-By-Agreement (SBA) for Pakistan for an amount of $3 billion on July 12, and a day later, the State Bank of Pakistan (SBP) received the first installment of $1.2bn.
This inflow came on top of a $1bn deposit from the United Arab Emirates (UAE) on July 12, and a $2bn deposit from Saudi Arabia on Tuesday.
To note, as of June 30, 2023, the country's total reserves stood at $9.75bn, and as per Ishaq Dar the reserves will stand at around $13-14bn by this week.
PSX points surge
It is worth noting that the KSE-100 index has gained 3589.92 points after the aforementioned development of the agreement with IMF, signed on June 29, 2023.
Fitch Ratings
Fitch Ratings upgraded Pakistan's Long-Term Foreign-Currency Issuer Default Rating (IDR) to 'CCC' from 'CCC-' on July 10, indicating movement toward stability.
