PSX increases following the IMF’s “positive news”
Tuesday saw a rise in stocks after the International Monetary Fund (IMF) decided to release a $1.17 billion tranche to Pakistan after a lengthy delay.
The benchmark KSE-100 index of the Pakistan Stock Exchange (PSX) increased by 436.11 points or 1.03% to 42,940.45 points as of 9:40 am, up from its previous closing of 42,504.34 points.
Investors’ expectations have been raised by the IMF program’s resurrection because it is anticipated that Pakistan will now get funding from global and bilateral organisations in addition to friendly nations.
Officials from the government said Monday night that the international lender has authorised the seventh and eighth evaluations of the $6 billion Pakistan initiative after months of frantic work.
Saad Ali, a capital market analyst, told Geo.tv that the IMF board’s final approval has ended the protracted wait for programme resumption.
The capital market expert predicted that this “would liberate more foreign inflows, which will help the currency while other macro indicators are exhibiting steady recovery.”
The analyst went on to say that continuous macroeconomic development and a lack of significant political noise will boost market confidence and help to extend the current rally.
The Extended Fund Facility (EFF) for Pakistan’s “extended arrangement” has now through its combined seventh and eighth reviews, according to a statement from the Fund.
According to the announcement, “The Board’s resolution permits an immediate disbursement of SDR 894 million (about $1.1 billion), bringing the total purchases for budget support under the arrangement to approximately US$3.9 billion.”
Tahir Abbas, the head of research at Arif Habib Limited, claimed that Pakistan will now be able to receive the much-needed financing within the next three days thanks to the IMF’s permission.
In light of this, Pakistan is anticipated to get bilateral and multilateral finance from the World Bank, Islamic Development Bank, and Asian Development Bank (ADB).
According to Abbas, it will also persuade friendly nations like Saudi Arabia, the United Arab Emirates (UAE), and Qatar to provide Pakistan money, bridging the country’s funding need from outside sources.The analyst continued, “This will assist improve the situation in the stock and currency markets, as it has finally offered clarity on the economic front.
