A report was released by Fitch Solutions in which it was stated that it is expected that Pakistan rupee will fall to Rs148 against the US dollar by the end of fiscal year 2018-19.
The report said, “Pakistan’s Finance Minister Asad Umar has alluded that the government can afford a two-month delay in the negotiations as the $6 billion loan secured from Saudi Arabia in October suggests there is no imminent balance of payments crisis in the near-term.”
Further stating, that even though no agreement has been reached between Pakistan and the International Monetary Fund on the bailout package, chances are that the agreement will be done by the first quarter of 2019.
Must read: Pak Rupee Hits Record Low Against the Dollar
The report stated that due to downfall in the oil prices in October and November, Pakistan’s economy relatively stabilized as Pakistan is the net importer of oil. After an IMF bailout is reached and due to lower rates of oil,Pakistan’s rupee value will stabilize against the US dollar.
As per the Fitch Solutions, “The first round of talks between the IMF and the Pakistani government, which ended on November 20, was inconclusive after both sides failed to bridge the gulf on a wide range of issues such as the increase in electricity prices, hike in interest rate, rupee devaluation,tax collection targets, and the circular debt problem at the state’s utilities.”
Further on the report revealed that there are fewer chances for Pakistan to receive an $8 billion bailout package from IMF in the meeting scheduled on15th January, 2019.
“The IMF team also stated that ‘the reversal of policies on many fronts is the main cause of existing quagmire which Pakistan’s economy is witnessing currently’, and now‘Pakistan will have to undertake a comprehensive package’”.
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