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Pakistan stocks cap worst week in 17 years after securing bailout from IMF

It secured its 13th IMF bailout since the late 1980s for about $6 billion earlier this week after a six-month delay

Faseeh Mangi | Bloomberg 

Pakistan rupee

Pakistan’s rupee and stocks fell, extending the week’s losses, after the nation secured a bailout from the Monetary Fund.

The South Asian nation is expected to adopt tough measures as part of its deal with the IMF, which investors speculate may include further currency devaluation. It secured its 13th bailout since the late 1980s for about $6 billion earlier this week after a six-month delay.

“The program was supposed to bring certainty. Unfortunately until now there is confusion,” Arif Habib, chief executive office at Arif Habib Corporation said in a televised program after meeting finance adviser Abdul Hafeez Shaikh as part of a business community delegation in Karachi on May 16. “We have asked the finance adviser to tell us what is going to happen. People have not been able to anticipate where the rupee and interest rates will stand.”

Pakistan’s has erased half its market value over the past two years as the deterioration in the prompted rating agencies to downgrade the nation. The currency has plunged more than 20% in the past year, the worst performer in a basket of 13 currencies in Asia compiled by Bloomberg.

The central bank is due to meet Monday to decide on monetary policy, with economists from Intermarket Securities and Foundation Securities among those expecting a seventh straight hike in interest rates.

First Published: Sat, May 18 2019. 22:26 IST