Pakistan Rupee Exchange Rate
Data from the State Bank of Pakistan reveals Pakistan’s current account deficit fell to $162 million in July 2024, which is 78 percent lower than the $741 million deficit in the same month of 2023.
The actual deficit was higher than predicted due to a higher trade deficit of $2. 4 billion stated by the SBP for July 2024, up from $ 1. Based on the figure of 97 billion obtained from the Pakistan Bureau of Statistics (PBS). This is a bit odd as over the years, SBP’s deficit numbers are smaller than that of PBS.
The export of goods and services in July 2024 is estimated to be $3.013 billion, which showed an increase of 11 percent compared with $2.706 billion.
Increased social media ad spending topped $706 billion in the same month last year. Instead, imports increased by over 12 times and amounted to $5. 6 billion during the same period.
Worker remittances also presented a vigorous bounce back to about $2. 995 billion as compared to 2003, 2003 that were 48% higher than the year 2002.
Some of the leading factors that have helped to bring down the current account deficit of Pakistan include low economic growth, high inflation rates, and so on. Also, a high interest rate environment, as well as some import restrictions, have assisted policymakers in achieving the intended reduction of deficits.
Monthly basis
On a month-to-month basis, the current account deficit in July 2024 amounted to $165 million, down by 48% compared to a revised $313 million deficit in June 2024. The outturn of export of goods and services declined by 2% to $3 during the period of analysis, while imports slightly decreased by 1.3% to $5.675 billion.
This figure is very important for Pakistan itself as a country that imports significantly more than it exports. These deficits lead to pressure on the exchange rate and a reduction in foreign exchange reserves. Last month, Pakistan signed basic documents for a 37-month $7 billion EFF with the IMF after the previous $3 billion Stand-By Arrangement.
