Islamabad, Sep 12: State Bank of Pakistan (SBP), foreign investment in Pakistan’s domestic bonds suffered a steep fall during the first 23 days of August, with investors withdrawing $103.5 million from treasury bills.
Market analysts blame the nation’s continued political unrest and the hold-up in reaching an agreement with the International Monetary Fund (IMF) for this outflow. The State Bank is scheduled to make its monetary policy announcement this Thursday, which means that a rate cut will further reduce the allure of Treasury bills for overseas investors.
According to SBP data, foreign inflows into domestic bonds totaled $316 million between July 1 and August 23, while withdrawals totaled $197.6 million during the same period.While inflows were higher in July, totaling $264 million, they fell sharply to just $52 million in the first 23 days of August.
In July, foreign direct investment (FDI) increased by 63% to $136.7 million from $82 million during the same time the previous year, indicating promising growth once again. Experts warn, meanwhile, that if political unrest and the IMF loan remain unclear, FDI could drop in August.
