June 30, 2019: The local equity market bid farewell to fiscal year 2018-19 on a positive note, as benchmark KSE 100 index broke a four-day-long losing streak to end Friday’s session 127 points higher than the session prior to it, thus ending FY19 at 33,901 points.

However, the overall performance of equity markets was jeer-worthy as the index lost nearly 1,223 points over the week on account of pessimism hovering around the risk of Pakistan being put on the watchdog list by FATF.  

With respect to local currency, the Pakistani rupee (PKR) bounced back with an appreciation of 4 rupees against US Dollar (USD) in Friday's interbank session as it closed the final session of fiscal year 2019 at PKR 160.05 per USD, against the closing of PKR 164.06 per USD in the prior session. From a weekly point of view, the local currency lost nearly 3.22 rupees against the greenback.

Meanwhile, the following economic data was released over the course of last week:

• The government of Pakistan has accumulated an additional net debt of Rs.136.58 billion during the week ended June 14, 2019, which brings its total net borrowing for ongoing fiscal year (FY19) to Rs.1.58 trillion.
• Pakistan's non-government sector has borrowed another net sum of Rs.2.12 billion during the week ended June 14, 2019, which brings the cumulative net borrowing for ongoing year to Rs.933.27 billion.
• The overall output of Large Scale Manufacturing Industries (LSMI) for July-April, 2018-19 decreased by 3.51% compared to July-April, 2017-18.
• The investment to GDP ratio has been targeted by the government to grow at 15.8 percent during the upcoming fiscal year 2019-20 in order to achieve sustained and inclusive growth.
• Weekly Sensitive Price Indicator (SPI) for the Combined Group decreased by 0.09% during the week ended Jun 20, 2019 while the SPI increased by 11.87% compared to the corresponding period from last year.
• Total fertilizer offtake during the month of May, 2019 stood at 458 thousand tonnes, demonstrating an increase of 49.7 percent as compared to the corresponding period of last year.
• Urea sales witnessed a rise of 20 percent during the month of May 2019, as the total offtake during this period stood at 593 thousand tonnes as compared to the same period of last year.
• DAP offtake for the month of May 2019 has increased by 240.8 percent to 213 thousand tonnes.
• Outflow of profits and dividends on foreign investments from the country dropped 25 percent to $1.67 billion in the eleven months of fiscal year 2018-19, as compared to $2.2 billion sent during the corresponding period of last year.
• Imports into Pakistan during the month of May, 2019 amounted to Rs.734,578 million (provisional), as against Rs.670,895 million (provisional) in April, 2019 and Rs.667,562 million during May, 2018
• Exports from Pakistan during the month of May, 2019 amounted to Rs. 306,303 million (provisional) as against Rs.295,541 million (provisional) in April, 2019 and Rs.246,907 million during May, 2018 showing an increase of 3.64% over April, 2019 and of 24.06% over May, 2018.
• The overall production of petroleum commodities has witnessed a decrease of 6.34 percent during the first 10 months (July-April) of the current fiscal year as compared to corresponding period of 2017-18.
• Pakistan's Forex Reserves decreased by USD 287.80 Million or 1.97% and the total liquid foreign reserves held by the country stood at USD 14,351.30 Million on Jun 21, 2019.

The various economic and policy-oriented developments that took place during the departed week include:

• The International Monetary Fund (IMF) Board is scheduled to meet on Wednesday, i.e. July 3, 2019, to consider three-year extended fund facility of $6 billion for Pakistan. Adviser to Prime Minister on Finance, Revenue and Financial Affairs, Abdul Hafeez Shaikh will attend the meeting to sign the said agreement with IMF
• Meanwhile, on Friday, Prime Minister Imran Khan directed to launch a special campaign to control price hike and ineffectiveness of the systems in the country.
• On Thursday, Fitch Solutions revised down Pakistan’s economic growth forecast for fiscal years 2019-2020 to 2.7% from a previously quoted estimate of 4%.
• On Thursday, SBP allowed the expatriates to continue operating their bank accounts in the country without biometric verification after proving their identity as Overseas Pakistanis in their local banks.
• On Wednesday, SBP conducted an auction on in which it sold PIB’s worth Rs.149.919 Billion for 3, 5 and 10 years in Fixed and Floating rate bonds. Auction Target was Rs.200 Billion divided evenly between fixed and floating bonds, whereas the maturing amount was Rs.19.47 Billion.
• The same day, Economic Coordination Committee (ECC) acceded to the proposal of Petroleum Division to allow import of Petroleum products by PSO under Saudi Fund for Development. It also reviewed various slabs of gas tariff. The ECC approved Supplementary and Technical Supplementary Grants of various Ministries/Divisions.
• Meanwhile, the National Electric Power Regulatory Authority (NEPRA) on Wednesday approved 10 paisa hikes in power tariff for May under monthly fuel adjustment formula.
• The Government of Pakistan on Wednesday announced the withdrawal of Rs. 40,000 denomination National Prize Bonds from circulation, with immediate effect.
• On the upside, Pakistan escaped a potential downgrade from the MSCI EM index at the 2019 annual market classification review on Tuesday.
• On Monday, Prime Minister Imran Khan said that the government would not extend the deadline of the tax amnesty scheme ending on June 30, 2019 and appealed to the people to declare their assets or face confiscation and punishment.
• Apart from this, after a visit from Qatar’s Emir to Pakistan, Qatar is expected to extend a sum of $3 billion to Pakistan under direct investment, reported the state-run Qatar News Agency on Monday.
• National Assembly Friday passed the federal budget on Friday, approving the finance bill 2019-20 to give effect to the financial proposals of the government.
• Pakistan received its first installment of 500 million dollars from Qatar. This amount will increase the foreign exchange reserves of the country to 14.8 billion from 14.381 billion dollars.
• Pak Suzuki announced an increase in prices across their assembly line by up to Rs. 329,000, citing PKR devaluation along with new duties levied by the government as the reasons for this massive increase in the value of their vehicles.

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