August 20, 2021 (MLN): Pakistan’s current account balance (CAB) posted a deficit of $773million in July 2021, compared to a surplus of $583mn in the corresponding month last year.
In the previous month, CAB posted a deficit of $1.6bn, suggesting that deficit declined by 52% MoM mainly attributable to decline in imports..
This deficit is in line with SBP’s expectations of a current account deficit of 2-3% of GDP as economic activity continued to progress, Central Bank via its official Twitter handle said on Friday.
Despite the recent increase in current account deficit, SBP’s foreign reserves position continued to strengthen on monthly basis. This is in contrast to past trends and is supported by country’s market-based exchange rate system.
According to the data issued by SBP, during the month of July’21, total imports of goods and services increased by 41% YoY to $6.1bn compared to $4.3bn in July’20. While on monthly basis, total imports declined by 14% MoM from $7.13bn in June’21.
Total Exports during the month jumped by 17% YoY to $2.74bn compared with $2.3bn logged in the same month the previous year. Whereas, on a monthly basis, total exports witnessed a decline of 11% in Jul’21 as it was $3.06bn in the previous month.
This resulted in a trade deficit of $3.37bn in Jul’21, up by 70% YoY and down by 17% MoM.
Workers' Remittances by overseas Pakistani registered a marginal growth of 1% MoM while declined by 2% YoY to $2.7bn during July’21, compared to $2.68bn in the previous month and $2.76bn in Jul’20.
