Business

IMF – Pakistan deadlock and polictical uncertainity cost Stocks Exchange 1378 points

The Pakistan Stock Exchange (PSX) slumped over 3.4%, approximately 1,348 points, and hit a two-year low at around 38,900 points on Tuesday.After the close of trading, the KSE-100 Index was down 1,378.54 points or 3.47%, hovering around the 38,342.21 mark.

The PSX altogether lost 1980 points almost 5% of the market in just two days(Monday-Tuesday).The 100-index of the Pakistan Stock Exchange (PSX) witnessed a bearish trend, losing 602.70 points, a negative change of 1.49 percent, closing at 39,720.75 on Monday.

Political instability in the wake of the political tug-of-war-for-power in the country coupled with the Punjab assembly dissolution and local body elections in Sindh impacted the investment climate.

Arif Habib Corporation’s Ahsan Mehanti said the index fell on reports of the IMF’s harsh conditions, including an end to managing the exchange rate, increase in gas prices and resolution of the circular debt issue.

Moreover, concerns regarding monetary policy rate hikes, depreciation of the rupee against the US dollar, and delay in the ninth review of the International Monetary Fund (IMF) programme further dented investors’ sentiment.

The exchange rate is currently hovering at around Rs228 per USD.Moreover, the market is expecting the central bank to increase its key policy rate by 100 basis points to 17% by next week (January 23).

 

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