Rising trend in prices of Pakistan’s Global Bonds

Following the IMF’s announcement to consider issuing a package to Pakistan on September 25, there has been an uptick in the prices of Pakistan’s issued Sukuk and Eurobonds in the global market.

Topline Research’s weekly report indicates that compared to the previous week, the price of sovereign bonds increased by 2 to 19 cents for the week ending September 13.

Data shows that some bonds had seen price declines or remained stagnant due to delays in the debt program for Pakistan, but improvement has started to show following the IMF announcement.

According to the latest figures, the price of Pakistan’s $800 million 30-year global bond, maturing in April 2051, increased by 19 cents per unit to 77 cents per unit.

Another 30-year bond, maturing in March 2036, saw a price increase of 18 cents to 75.7 cents per unit.

The price of $500 million 10-year bonds, maturing in September 2025, rose by 2 cents to 97.3 cents per unit.

In an interview with private news channel, Saad Hanif, Head of Research at Ismail Iqbal Securities, said that the uncertainty over the Pakistani economy has lifted following the IMF’s announcement to consider a debt package, leading to an increase in Pakistani bond prices.

Research Head Tahir Abbas of Arif Habib Limited added that the IMF’s announcement has restored confidence among global financial institutions and other sources.

Once the IMF program is approved, Pakistan will be able to obtain additional loans from other sources, increasing the supply of dollars in the local market and further boosting global investors’ interest in Pakistan’s issued bonds.

Following the IMF program and improved credit ratings, it is expected that the government will once again turn to the global market to sell Panda Bonds, Eurobonds, and Sukuk Bonds.

Abbas also noted that a reduction in the policy rate is another significant factor contributing to the rise in Pakistani bond prices.