Pakistan’s current account shows $3.4bn deficit in 1QFY22

October 19, 2021 (MLN): Pakistan’s current account balance (CAB) posted a deficit of $3.4 billion in the first quarter of the current fiscal year i.e. July-Sept FY22, compared to a surplus of $865 million in the corresponding period last year.

A strong rebound in economic activity and higher international commodity prices kept the current account deficit (CAD) at an elevated level, Central Bank said on its Twitter handle.

In the month of Sept’21 alone, the country recorded a CAD of $1.11bn against the surplus of $27mn in Sept’20. While on a sequential basis, CAB witnessed an improvement in deficit, down by 24.4% MoM when compared to a deficit of $1.47bn in Aug’21 on the back of an increase in exports, as per data released by the State Bank of Pakistan (SBP) on Tuesday.

The trade deficit in Good narrowed by 6% MoM to $3.43bn in Sept’21 as exports of goods jumped by 12.5% MoM while imports saw a marginal increase of 1.3% MoM. However, the trade deficit in Goods has widened by 82% YoY in the said month

Meanwhile, the Trade balance in Services, while still negative, also improved by 65.2% MoM to $117mn courtesy of a 24.1% MoM reduction in imports though the exports increased marginally by 1.3% MoM.

On year-on-year, the trade deficit in services went up by 23% YoY.

Worker remittances improved slightly by 0.45% MoM to $2.67bn from $2.66bn in Aug’21.

On a cumulative basis during July-Sept FY22, remittances by overseas Pakistani moved up by 12.5% YoY to $8.04bn from $7.14bn recorded in July-Sept FY21.

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