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The weekly roundup of Pakistan’s economy

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June 2, 2019 (MLN): The departed week remained volatile for the local equity market. The four-day week began on a negative note due to lack of clarity over the announced market support funds, but later in the midweek, euphoria on the back of market support fund was witnessed again after confirmation from Finance Adviser, seemingly revived investors’ interest.

Moreover, Pak Rupee gained some strength against the USD, which further kept the sentiments positive. The Pakistan equities closed the week at 35,975 ponits after gaining 270 points (up by 0.8%) WoW. During the week, OMCs and commercial banks were the major contributors to the index while fertilizers were the major laggards.

In addition to this, the various economic and policy-oriented developments that took place during the departed week include:

On Friday, the government of Pakistan raised the price of petroleum products by up to Rs.4.50/liter for the month of June 2019.

Meanwhile, Revenue Minister Hammad Azhar announced on his official page on social media that the scheme for promissory notes (bond) has been activated and Rs.7 billion of bonds in lieu of sales tax refunds have already been issued.

The same day, Chairman Liquefied Petroleum Gas (LPG) Industries Association of Pakistan, Irfan Khokhar said due to better policies of the government and reduction in LPG prices in the international market, the LPG would be available to domestic and commercial consumers at low rate.

On Thursday, the State Bank of Pakistan (SBP) rescheduled the Market Treasury Bill (MTB) auction originally scheduled for June 5, 2019 and revised the auction date for the Competitive Auction to June 03, 2019 while the settlement date has been moved from June 06 to June 10, 2019.

Meanwhile, the same day, Economic Coordination Committee (ECC) meeting chaired by the Advisor on Finance Dr. Hafeez Shaikh, approved a Rs.20 Billion Fund to stabilize the stock market.

Moreover, the Central Depository Company of Pakistan (CDC) Limited lowered its tariff structure as a gesture of support for the browbeaten stock market of Pakistan. As per the local media, CDC reduced the annual fee on long term redeemable securities by nearly 65%.

On Wednesday, the State Bank of Pakistan (SBP) conducted an auction in which it sold PIB’s worth Rs.141.18 Billion in Fixed and Floating rate instruments.

On Tuesday, the Chief Executive Officer (CEO) at Pakistan Stock Exchange (PSX), Mr. Richard Morin stepped down from his position.

Beside these developments, the statistical data released this week apprising the economic standing of the country are listed below:

  • Repatriation of profit/ dividend on foreign investment showed a mammoth growth of over $133 million in April 2019 as the latest figure logged in at $188.4 million which is 3.4x higher than the repatriation recorded last month.
  • Pakistan's Forex Reserves decreased by USD 36.70 Million or 0.24% and the total liquid foreign reserves held by the country stood at USD 15,089.80 Million on May 24, 2019.
  • Pakistan received nearly $330.5 million economic assistance in the form of bilateral and multilateral foreign loans and grants in the month of April 2019.
  • The Banking sector spread for April 2019 has narrowed by 33 basis points (bps) over the month as it shrunk from 5.67% in March 2019 to 5.34%.
  • Country’s circular debt in the power sector had risen to Rs.795 billion
  • The Weekly Sensitive Price Indicator (SPI) for the Combined Group increased by 0.33% during the week ended May 23, 2019 while the SPI increased by 13.96% compared to the corresponding period from last year.

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Posted on: 2019-06-02T14:19:00+05:00

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