Current Final

Category: Business

  • Pakistan records current account deficit of nearly $270 million

    Pakistan records current account deficit of nearly $270 million

    In the latest economic update, Pakistan has reported a current account deficit of $269 million for the month of February, according to data released by the State Bank of Pakistan (SBP).

    This shift is attributed to a notable decrease in exports coupled with a surge in imports.

    The data reveals that total exports experienced a 4.40 per cent month-on-month (MoM) decline, amounting to $3.37 billion in February, compared to $3.53 billion in the preceding month.

    However, on a year-on-year (YoY) basis, exports displayed positive growth, rising by 15.84 per cent from $2.91 billion in the corresponding month of the previous year.

    Conversely, total imports registered an 11.01 per cent MoM increase and a 21.33 per cent YoY surge, reaching $5.51 billion in February. This compares to $4.96 billion in December and $4.54 billion in January of the previous year.

    On a cumulative basis, the current account deficit for the first seven months of fiscal year 2023-24 (7MFY24) stands at $1.09 billion, showcasing a significant 71.21 per cent YoY improvement compared to the $3.8 billion deficit recorded in the same period of the previous fiscal year.

    Meanwhile, workers’ remittances for January saw a marginal 0.63 per cent MoM increase, reaching $2.4 billion, compared to $2.38 billion in the previous month.

    On a YoY basis, remittances experienced a substantial rise of 26.16 per cent, standing at $1.9 billion in January 2024.

    Looking at the cumulative figures for 7MFY24, workers’ remittances amounted to $15.83 billion, reflecting a 2.97 per cent YoY decrease from $16.32 billion in 7MFY23.

  • Gold price jumps by Rs1,100 per tola, reaching Rs214,300

    Gold price jumps by Rs1,100 per tola, reaching Rs214,300

    The gold prices in Pakistan continued their upward trajectory, building on gains from the last session of the previous week. On Monday, the price of 24-karat gold surged by Rs1,100 per tola, reaching Rs214,300 per tola.

    According to the Karachi Sarafa Association, the price of 10-gramme 24-karat gold stood at Rs183,728, marking an increase of Rs943 compared to the previous session. Additionally, the price of 10-gramme 22-karat gold rose to Rs168,417.

    In contrast, silver prices remained stable, with 24-karat silver being sold at Rs2,580 per tola and 10-gramme silver trading at Rs2,211.93.

    It is noteworthy that domestic gold ended last week in the red zone due to a decline in international prices. The ongoing uncertainty surrounding the delay in election results also failed to stimulate demand for this safe-haven asset.

    Internationally, spot gold has extended its rally for the third consecutive session, currently trading at $2,021.8. This rebound follows last week’s release of hotter-than-anticipated US inflation data, which initially pushed gold below the $2,000 mark for the first time in two months.

    Given the influence of domestic currency fluctuations on the domestic gold rate, it is crucial to mention that the Pakistani rupee (PKR) concluded its 13-week-long historic winning streak against the US dollar. Last week, the PKR experienced a marginal drop of 8 paisa.

    Since gold is denominated in US dollars, a depreciation of the PKR against the US dollar results in an increase in the value of PKR-denominated gold. The market remains attentive to both global and domestic factors influencing these shifts in precious metal prices.

  • Pakistan’s mobile phone imports skyrocket, surpassing $987 million in first half of FY 23-24

    Pakistan’s mobile phone imports skyrocket, surpassing $987 million in first half of FY 23-24

    Pakistan has witnessed a remarkable surge in mobile phone imports, reaching $987.539 million during the first half (July–January) of the fiscal year 2023–24. 

    This marks a substantial growth of 138.08 per cent compared to the same period in the previous fiscal year, where imports totaled $414.800 million.

    The data, released by the Pakistan Bureau of Statistics (PBS), underscores the country’s increasing reliance on imported mobile devices.

    In January 2024 alone, Pakistan’s mobile phone imports rose by 10.70 per cent on a month-on-month basis, totaling $194.928 million, compared to $176.093 million in December 2023. 

    Year-on-year comparisons reveal an even more staggering growth of 275.15 per cent in January 2024, compared to $51.960 million in January 2023.

    The overall telecom imports into Pakistan during July–January 2023–24 amounted to $1.243 billion, showcasing a robust 93.06 per cent growth compared to the same period in the previous fiscal year. 

    Year-on-year, the growth in overall telecom imports stood at an impressive 197.07 per cent, reaching $232.709 million in January 2024, compared to $78.336 million in January 2023.

    Despite challenges faced by the local manufacturing sector, including a decline of around four per cent in local manufacturing and assembling of mobile handsets during the calendar year 2023, commercial imports of mobile handsets increased. 

    Official data revealed that local manufacturing plants produced 21.28 million mobile handsets in 2023, compared to 21.94 million in 2022 and 24.66 million in 2021. However, commercial imports rose from 1.53 million in 2022 to 1.58 million in 2023.

    Moreover, of the locally manufactured and assembled mobile handsets in 2023, 13 million were 2G devices, and 8.28 million were smartphones. 

    According to the Pakistan Telecommunication Authority (PTA), 59 per cent of mobile devices in Pakistan are smartphones, while 41 per cent are 2G devices.

    Despite the challenges faced by the local manufacturing sector, the significant growth in mobile phone imports underscores Pakistan’s increasing reliance on imported devices, contributing to the country’s evolving telecom landscape.

  • Authorities confiscate smuggled cigarettes worth Rs14 crore

    Authorities confiscate smuggled cigarettes worth Rs14 crore

    In a substantial crackdown on the illicit trade of non-duty-paid cigarettes, the Inland Revenue Enforcement Network (IREN) successfully seized over 679,000 packerites (15,580,000 sticks) of smuggled cigarettes during a two-day operation.

    The confiscated cigarettes, representing various local and foreign brands, including Business Royal, H&P, Platinum, Milano, and Olympic, have an estimated value exceeding PKR 140 Million.

    The enforcement teams targeted local shops in Peshawar, Multan, and Sialkot, where the availability of non-duty paid cigarettes had seen a concerning surge.

    This operation was initiated under the directive of Mir Badshah Khan Wazir, Member (IR-Operations), who emphasized the need to curb the illegal trade of tobacco products.

    Criminal proceedings have been set in motion against both manufacturers and transporters involved in this illicit trade.

    One of the key factors contributing to the rise in the popularity of smuggled cigarettes is the substantial price difference compared to duty-paid alternatives.

    While the cost of a pack of 20 duty-paid cigarettes starts at Rs600, the non-duty paid counterparts can be obtained for as low as Rs200. Some reports even suggest that certain brands are being sold at an even more economical rate.

    The increasing prevalence of non-duty paid cigarettes poses a serious concern, not only in terms of lost revenue for the government but also due to health implications.

    Smokers in Pakistan, attracted by the affordability of these illicit products, have contributed to the surge in sales of non-duty paid cigarettes.

    The IREN’s recent operation sends a clear message that the authorities are actively addressing this issue to safeguard public health and financial interests.

    As investigations unfold, it remains to be seen how this crackdown will impact the illicit trade of cigarettes and discourage individuals from opting for non-duty paid alternatives.

  • 24 karat gold price surges by Rs800 per tola, silver takes a dip

    24 karat gold price surges by Rs800 per tola, silver takes a dip

    In a notable shift in the precious metals market, the per-tola price of 24 karat gold in Pakistan witnessed an increase of Rs800, reaching Rs213,200 on Saturday. This rise is compared to its previous sale at Rs212,400 on the last trading day.

    Similarly, the price of 10 grammes of 24 karat gold experienced an uptick, climbing by Rs686 to Rs182,785 from Rs182,099.  The All Sindh Sarafa Jewellers Association reported that the prices of 10 grammes of 22 karat gold also saw an increase, reaching Rs167,553 from Rs166,924.

    On the other hand, the price of per tola silver exhibited a decrease of Rs30, settling at Rs2,550. Simultaneously, the price of ten grammes of silver witnessed a decline of Rs25.72, reaching Rs2,186.21.

    Internationally, the price of gold ascended by $9, reaching $2,034 from $2,025, as reported by the Association. These fluctuations in the precious metals market reflect the dynamic nature of global economic conditions, influencing prices both domestically and internationally.

  • Yearly basis: Weekly inflation stays above 34%

    Yearly basis: Weekly inflation stays above 34%

    In the week concluding on February 15, 2024, the Weekly Sensitive Price Indicator (SPI) for the Combined Group exhibited a slight decrease of 0.78 per cent week-over-week (WoW).

    However, compared to the same period last year, the SPI surged by 34.25 per cent YoY, according to data released by the Pakistan Bureau of Statistics (PBS).

    The combined index, standing at 315.18, marked a slight dip from 317.65 recorded on February 8, 2024. A year ago, on February 16, 2023, the index was substantially lower at 234.77.

    Analysing the data further, out of the 51 items monitored, the average price of 22 items increased, 11 items witnessed a decrease, and 18 items remained stable.

    Notably, PBS did not release SPI data last week, following a 0.28 per cent WoW decline in the preceding week.

    During the week under review, significant decreases were noted in the prices of eggs (28.82 per cent), chicken (4.23 per cent), onions (3.48 per cent), LPG (2.85 per cent), and gur (1.13 per cent).

    Conversely, notable increases were observed in the prices of bananas (4.64 per cent), potatoes (2.80 per cent), match boxes (1.31 per cent), long cloth (1.29 per cent), and cooked daal (0.77 per cent).

    Analysing the SPI percentage change by income groups, a uniform decline of -0.82 per cent to -0.72 per cent was witnessed across all quantiles.

    The lowest-income group experienced a weekly decline of 0.78 per cent, while the highest-income group recorded a decrease of 0.77 per cent.

    On a yearly basis, SPI increased across all quantiles, ranging between 28.68 per cent and 38.54 per cent. The lowest-income group saw a 28.68 per cent increase, while the highest-income group recorded a 32.08 per cent rise.

    The average price of Sona urea fell to Rs4,513 per 50 kg bag, marking a 0.50 per cent decrease from last week and a significant 54.84 per cent increase from the previous year.

    Meanwhile, the average cement price recorded at Rs1,234 per 50 kg bag marked a 2.05 per cent increase from the previous week and a 14.27 per cent hike from the prices recorded last year.

    In a volatile market environment, these fluctuations in the SPI indicate the dynamic nature of the economic landscape, impacting consumers across various income groups.

  • Political instability, IMF loan conditions threaten Pakistan’s economic growth

    Political instability, IMF loan conditions threaten Pakistan’s economic growth

    In January, Pakistan experienced a boost in economic activity, thanks to the financial aid provided by the International Monetary Fund (IMF), as reported by Bloomberg Economics Tracker.

    However, there are three key developments that may impact future economic conditions.

    Firstly, the aftermath of the inconclusive February 8 election has resulted in persistent political instability, presenting a potential obstacle to new investments.

    Secondly, there is a likelihood of more stringent conditions associated with additional IMF loans. Lastly, there is an increasing probability that the State Bank of Pakistan will delay rate cuts.

    Despite the challenges, January saw a positive trend with a 0.9 per cent increase in economic activity compared to December, breaking a four-month contraction streak.

    The injection of IMF loans and eased trade restrictions contributed to this improvement, enabling increased purchases of essential import supplies.

    Looking ahead, the unresolved election outcome may prolong political uncertainty, affecting potential investments.

    The recent hike in gas prices on February 15 will likely drive inflation higher, further reducing the chances of a March rate cut.

    Considering these developments, Bloomberg Economics is considering revising its growth outlook.

    While Bloomberg currently predicts 2.1 per cent GDP growth through June 2024 (up from a 0.2 per cent contraction in the previous fiscal year), the consensus estimate is 2.5 per cent, and the IMF forecasts 2 per cent.

    It’s essential to note that the Bloomberg Economics monthly tracker assesses inflation-adjusted indicators of activity.

  • 24-karat gold price increases by Rs1,300 per tola

    24-karat gold price increases by Rs1,300 per tola

    In a persistent upward trend, the domestic bullion market showcased further gains, particularly in the value of 24-karat gold, which surged by Rs1,300 per tola to reach Rs212,400 on Friday.

    According to the latest report from the Karachi Sarafa Association, the price of 10-gram 24-karat gold experienced a notable increase, reaching Rs182,099 and reflecting a gain of Rs1,115 compared to the previous session.

    Simultaneously, the price of 10-gram 22-karat gold saw an uptick, settling at Rs166,924.

    Despite the positive momentum in the gold market, silver prices remained steady, with 24-karat silver holding at Rs2,580 per tola and 10-gram silver trading at Rs2,211.93.

    Interestingly, despite today’s substantial rise in gold prices and the prevailing political instability in the country, local gold is on track to record a weekly loss.

    This comes on the heels of hotter-than-anticipated US inflation data released on Wednesday, causing gold to dip below the $2,000 mark for the first time in two months.

    Bloomberg reported that the American Consumer Price Index (CPI) data disappointed investors, reversing recent declines in price pressures and dampening expectations for rate cuts this year.

    However, the international spot gold has rebounded strongly since Wednesday’s decline, currently trading at $2,007.61, reflecting a gain of over $3 day-over-day.

    Amidst these global dynamics, the fluctuation in the domestic currency plays a crucial role in determining the domestic gold rate.

    It’s noteworthy that the Pakistani Rupee (PKR) snapped its 13-week-long and historic winning streak against the US Dollar, experiencing a marginal drop of 8 paisa.

    Given that gold is denominated in US dollars, a depreciation of the PKR against the dollar contributes to the rise in the value of PKR-denominated gold.

    The bullion market’s resilience in the face of global challenges highlights its sensitivity to both local and international economic factors, providing a nuanced perspective for investors and stakeholders.

  • Petrol price increased by Rs2.73 to Rs275.62 per litre

    Petrol price increased by Rs2.73 to Rs275.62 per litre

    The government has raised the price of petrol by Rs2.73 per litre, bringing it to Rs275.62 per litre for the upcoming fortnight.

    Additionally, the cost of high-speed diesel has seen an uptick, rising by Rs8.37 per litre to reach Rs287.33 per litre, according to an official notification.

    These revised prices, recommended by the Oil and Gas Regulatory Authority (OGRA), have come into effect as of midnight on February 16 and are slated to persist until February 29.

    The surge in petrol and high-speed diesel prices aligns with expectations following the adjustment in the exchange rate.

  • SBP’s foreign exchange reserves rise by $13 million

    SBP’s foreign exchange reserves rise by $13 million

    In a positive development for Pakistan’s economic landscape, the State Bank of Pakistan (SBP) reported a weekly increase of $13 million in its foreign exchange reserves, reaching a total of $8.05 billion as of February 9, according to data released on Thursday.

    The country’s overall liquid foreign reserves now stand at $13.15 billion, with commercial banks holding a significant share of $5.1 billion in net foreign reserves.

    The central bank, however, did not provide specific details or reasons for the notable upswing in reserves during the mentioned week.

    In a statement, the SBP stated, “During the week ended on February 9, 2024, the SBP’s reserves increased by US$ 13 million to US$ 8,056.5 million.”

    This positive development comes on the heels of last week’s decrease in Pakistan’s central bank reserves, which experienced a dip of $173 million.

    The recent rebound signals resilience and stability in the nation’s economic standing, and financial analysts are likely to scrutinise the factors contributing to this uptick in the coming days.

    As the global economic landscape continues to evolve, Pakistan’s foreign exchange reserves play a crucial role in navigating economic challenges, and the recent increase reflects ongoing efforts to bolster the country’s fiscal strength.

    Experts anticipate that a robust foreign reserve position will provide a buffer against external shocks and instill confidence in the financial markets.