Pakistan to Get More Rollovers, Dollar Funding Post-IMF Board Approval

The International Monetary Fund (IMF) Executive Board has approved the first review for Pakistan under the Stand-By Agreement (SBA) which is likely to lead to the release of a US$ 700 million tranche. This will take the total disbursement by IMF under the SBA program to US$ 1.9 billion to Pakistan and will help support the foreign exchange reserves of the country. According to Topline Securities, more dollar funding for Pakistan is likely from Bi-lateral, Multi-lateral, and other sources after IMF board approval. This will also facilitate rollovers, supporting foreign exchange reserves and bringing stability to the currency. In its press release, the IMF stated that economic activity has stabilized, though the outlook remains challenging and contingent on the implementation of sound policies. IMF has revised its forecast for a few macro indicators, as mentioned below: The report sees inflation to be at 17.5 percent by the end of June 2024, with an average inflation rate of 23 percent for FY24. Additionally, it anticipates a 700bps cut in the policy rate in 2024, reaching 15 percent by Dec-2024.