Pakistan’s Current Account Posts Lowest Deficit in 13 Years

Pakistan’s Current Account Deficit (CAD) shrank by 79 percent in the fiscal year 2023-24 to $681 million compared to a deficit of $3.275 billion during the same period last year, according to the latest data by the State Bank of Pakistan (SBP). According to Arif Habib Limited, this is the lowest deficit in the last 13 years. This significant decline was driven by a 6 percent reduction in the trade deficit and an 11 percent increase in remittances. Meanwhile, the country posted a CAD of $329 million for the month of June 2024, 33 percent higher compared to a deficit of $248 million reported in the previous month. This came higher than expectations due to higher Balance on Primary deficit of $1.1 billion. To note, primary deficit is coming over $1 billion for second consecutive month as SBP is clearing backlog of profit/dividends repatriations, Topline Securities said in a statement. The June deficit is the second consecutive one in two months. The current account was green in February, March, and April 2024.