- „We assume the IMF and Pakistan will complete the review, after the IMF gives clarity on the budget,” says the analyst.
- The IMF is working with Pakistani authorities to fix its currency market and other issues.
- The rupee has fallen more than 20% this year after authorities demonetized it in January.
Amid talks with the International Monetary Fund (IMF) to restart a $6.7 billion bailout program, Fitch Ratings said the cash-strapped country was unlikely to devalue its currency again as pressure on the rupee eased.
„We currently do not expect the Pakistani rupee to depreciate much further,” said Krisjanis Krustins, Hong Kong-based director at Fitch.
“Though the currency has been fairly stable over the past few months, pressure on it Reserves [held by] State Bank of Pakistan It suggests minimal interventions to support the currency,” Krustins said in an emailed response to questions. Bloomberg.
The A multilateral lender It has said it is working with authorities to fix its currency market and other problems before resuming a bailout program that expires this month.
The rupee has fallen more than 20% since authorities devalued the currency in January this year, one of the worst performers globally.
The country’s dollar reserves have held steady at about $4 billion since late February, after falling more than 50% over the past 12 months. The funds will be critical to shore up an economy beset by supply shortages and avoid a sovereign default as billions of dollars in debt payments loom.
„We continue to assume that the IMF and Pakistan will complete the ongoing program review, after the IMF provides clarity on the budget,” Krustins said. „However, the window for this is fast closing, with the plan first set to expire in June, and substantial progress unlikely in the immediate run-up to elections by October.”
Prime Minister Shehbaz Sharif on Friday hoped the IMF would resume a stalled bailout program as the country has already met all the preconditions set by the global lender despite the economic crisis.
„The ninth survey will be completed soon,” the prime minister said during his address to the Union Cabinet of the coalition government, which presented its second budget.
The Washington-based IMF has said it is working with Pakistani authorities to address concerns about the country’s currency market and other issues before resuming the current bailout program, which is scheduled to end this month.
The government moved to prevent the outflow of foreign currency from the country and restricted imports to limit the outflow of dollars.
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