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The International Monetary Fund (IMF) has released the much awaited $700 million tranche, shoring up the State Bank of Pakistan’s (SBP) foreign reserves.
The SBP confirmed the development in a statement, adding that the tranche equivalent to $705.6 million was released on January 16 (Tuesday) “following the successful completion of the first review by the Executive Board of IMF under Stand By Arrangement (SBA)”
“The tranche release is in line with market expectations,” said Yousuf M. Farooq, director of research at Chase Securities. “Pakistan will have to continue with a tight fiscal policy to ensure economic stability and will have to enter a new EFF IMF program as soon as this SBA ends to ensure roll over of its external debt.
“The economic situation has improved significantly with Pakistan posting a current account surplus in December and a relatively stable currency. This will also ensure disinflation in coming months.”
More to follow
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