Citi sees new $8bn loan deal by July

Wall Street Bank Citi expects Pakistan to reach an agreement with the International Monetary Fund for a new four year of up to $8 billion programme by end-July, and recommends going long on the country’s 2027 international bond. Pakistan last month completed a short-term $3bn programme, which helped stave off sovereign default, but the government of Prime Minister Shehbaz Sharif has stressed the need for a fresh, longer-term programme. “While longer-term challenges pertain, we see several positive catalysts supporting the eurobonds,” Nikola Apostolov at Citi wrote in a note to clients. “First, a larger and longer EFF (Extended Fund Facility) could be finalised by July possibly a $7-8bn 4-year programme and secondly and a possible inflow of Saudi investments,”