Pakistan currency, stock markets take a hit as budget fails to restore investors confidence

The Pakistani rupee and stock markets have taken a hit as the government’s budget for the next fiscal year 2022-23 failed to gain investors’ confidence, on Monday.

The local currency surpassed the critical threshold of 204 against the US dollar in the interbank market during intra-day trade, while the benchmark KSE-100 index of the Pakistan Stock Exchange is pushed by nearly 800 points, falling below the 41,000 barrier.

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Former planning minister and senior PTI leader Asad Umar also commented on the budget in a sarcastic way, calling the budget for 2022-23 “wonderful”.

He further added that “who else is happy with the budget other than the companies that produce candies”.

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While, capital market expert Saad Ali said that, “the sentiment is negative across all capital markets today”.

He mentioned that everyone was looking forward to this budget and it was seen as a “major milestone”, however, once again the government has failed to make IMF happy with its budget and is unable to revive the country’s economy. 

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“In line with the statement of Finance Minister Miftah Ismail over the weekend, the market players expect that the government might have to revisit its proposed allocations and targets set in the federal budget in order to convince the IMF”, he added.

Ali also suggested that more clarity would be needed to develop a good budget and gain the confidence of investors.

(With inputs from agencies)

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