- The rupee loses Rs 0.65 in the interbank market during intraday trading.
- The KSE-100 index plunges more than 1,000 points at 2:34 p.m.
- The capital markets expert says sentiment is negative across all capital markets today.
KARACHI: Pakistan’s currency and stock markets lost further ground on Monday as first coalition government budget for the next fiscal year 2022-23 has failed to restore investor confidence, contrary to market expectations.
The local currency broke above the critical 204 threshold against the US dollar in the interbank market during intraday trading, while the benchmark KSE-100 of the Pakistan Stock Exchange (PSX) plunged more than 1,000 points, falling below the 41,000 barrier.
“Sentiment is negative in all capital markets today,” said capital markets expert Saad Ali. Geo.tv.
The expert said the federal budget for next fiscal year was seen as a “major milestone” in reviving the stalled $6 billion International Monetary Fund (IMF) program.
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However, Ali said the markets believe the federal budget is “insufficient” and the Fund may not accept the budget.
“In line with Finance Minister Miftah Ismail’s statement over the weekend, market participants expect the government to review its proposed allocations and targets in the federal budget in order to convince the IMF,” he said. he adds.
Ali added that the federal budget has further jeopardized the revival of the IMF’s long-awaited program. He argued that more clarity is needed because for now the feeling is that the government will have to do more.
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Commenting on the performance of the markets during the post-budget session, former planning minister and top PTI leader Asad Umar mocked the coalition government, sarcastically calling the federal budget for 2022-23 “wonderful “.
“What a wonderful budget…the public is angry. [There is] negative stock market momentum, further depreciation of the rupiah, [and] imported finance minister [Miftah Ismail] [is] pretend the IMF is unhappy,” he wrote.
The former planning minister further mocked the finance minister and asked who else was happy with the budget apart from companies that produce sweets.