Current account deficit shrinks by 68.13%

Continued import drop helped improve the current account imbalance, State Bank

Pakistan’s current account deficit (CAD) has shrunk 68.13 percent at $0.57 billion on a year-on-year basis, the State Bank of Pakistan (SBP) has said.

The CAD on a month-on-month basis has increased by 52.6 percent against September’s figure of $0.36 billion. The CAD for September was the lowest since April 2021.

According to the figures, the deficit for the first four months of the current fiscal year was $2.8 billion, down 46.82 percent from $5.3 billion from July to October 2021.

According to the central bank, “continued import drop helped improve the current account imbalance.”

When compared to the same quarter in the previous fiscal year 2022 imports had fallen by $2.7 billion or by 11.6 percent while exports had increased by $0.2 billion or by 2.6 percent.

The current account deficit has increased month-on-month despite a remark made last week by Finance Minister Ishaq Dar that it was anticipated to be below $0.4 billion.

“If this continues at the same rate it will be around $5-6 billion for the year whereas the forecast was $12 billion,” he said, adding that “the current account deficit was at $316 million in September and predicted to be around $400 million in October.”

Pakistan had a huge current account deficit of $17.3 billion or an average of $1.44 billion per month in the preceding fiscal year.

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