Due to worsening macroeconomic rudiments and provoking sentiments, three of the main markets of Pakistan economy’s, including the stock market, money market, and exchange rate are under pressure, as the markets reject to trust the government’s economic storyline, said a report.
Shockingly, the three markets, specifically the money market, stock market, and exchange rate, do not react confidently to the economic narrative being built by the monetary executives, resulting in a fast downslide, the publication reported.
Top official sources told to the media that Prime Minister’s Adviser on Finance and Revenue Shaukat Tarin and State Bank of Pakistan Governor Dr. Reza Baqir had pliably warned commercial banks against enduring to feat the condition for proposing Treasury Bills (T-Bills) at greater rates, or else strict action will be taken against them.
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In reality, the condition stayed unaffected as the government had developed frantic borrowers, and commercial banks started verbalizing to the government to pitch greater accessible rates for T-bill investments.
However, the bankers discerned that with the IMF agreement, the government could not scrounge from the State Bank of Pakistan (SBP), so they had anticipated the motivating seat and verbalized the government to capitalize on T-bills at greater rates and only in three months ripeness.
Moreover, if the previous sales are examined, the government elevated Rs 1,285 billion, from which 62.64% was produced for three months ripeness, 29.96% was outstretched for six months while merely 7.39% was made for a one-year period.
The government converted to a frantic borrower primarily owing to faulty debt management strategy, said, one top official. He further said that the government persisted traditional to create borrowings in the last few months on the other hand currently was desperate, so the sponsors exploited the situation.
Besides, Dr. Khaqan Najeeb, a former adviser to the finance ministry, told the media, “Astute policymakers must have an eye on the three key markets: PSX, money market, and the exchange rate market”.