Re-evaluating our import strategy

The recent trends in economic activity, particularly the inflation rate, inspire optimism about Pakistan's economic conditions. The inflation rate has dropped to its lowest level in nearly four years, while the trade deficit remains stable at around $5.4 billion in the first quarter of the fiscal year. Exports, standing at $5 billion, have increased by almost 15%, and imports have risen by 7% in the first two months of the fiscal year. The foreign exchange reserves at the State Bank of Pakistan (SBP) increased to over $10.7 billion as of September 27, 2024, following the receipt of a new tranche from the International Monetary Fund (IMF) earlier in the month. Although the current business confidence index is still in negative territory, the expected business confidence is in the positive zone, with businesses anticipating improved economic conditions over the coming months. The business community is particularly focused on the policy rate, expecting a significant cut in interest rates in the upcoming monetary policy statement.