Shares plunge 537 points over uncertainty on IMF review, dwindling forex reserves

Shares at the Pakistan Stock Exchange began the week in the red as uncertainty looms on the outlook for the country’s foreign exchange reserves with no clarity on when the pending ninth review of the International Monetary Fund (IMF) will conclude. Pakistan’s forex reserves stood at a historic low of $7.5 billion for the week ending on November 25 — barely enough to cover a month’s imports. Since then the country has repaid a $1 billion international bond on Friday, three days before its maturity on Monday, and also received $500 million from the Asian Infrastructure Investment Bank. Saudi Arabia also extended the term for its $3 billion deposit in Pakistan’s foreign reserves. The benchmark KSE-100 index fell by 537.43 points, or 1.28 per cent, to close at 41,612. “There seems to be significant uncertainty on the outlook for forex reserves, especially as the 9th IMF programme review is still pending,” said Raza Jafri, head of research at Intermarket Securities.