Current Account Deficit Shrinks To $229mn From $652mn In January: SBP

The State Bank of Pakistan (SBP) has announced that the current account deficit has decreased to $229 million from US$652 million last month.

The SBP Tweeted, “In January 2021, current account deficit reduced to $229mn from $652mn last month. For the first 7 months of FY21, the current account surplus is $912mn, a significant turnaround from the deficit of $2,544mn during the same period last year.”

“Compared to Jan20, exports grew steadily while remittances continued their record expansion. Imports of wheat and sugar to address domestic shortages, and palm oil, were significantly higher. Machinery imports continued to grow at double-digits, reflecting economic recovery,” the SBP added.

2/2 Compared to Jan20, exports grew steadily while remittances continued their record expansion. Imports of wheat and sugar to address domestic shortages, and palm oil, were significantly higher. Machinery imports continued to grow at double-digits, reflecting economic recovery.

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— SBP (@StateBank_Pak) February 22, 2021

Earlier, the State Bank of Pakistan has reduced the markup rate on investment under SBP’s Temporary Economic Refinance Facility (TERF) to 5% (from 7%) and on Long Term Financing Facility.

SBP reduces markup rate on investment under SBP’s Temporary Economic Refinance Facility (TERF) to 5% (from 7%) and on Long Term Financing Facility for the non-textile sector to 5% (from 6%) to extend the benefit of the recent reductions in the policy rate.

State Bank of Pakistan has also allowed TERF facility in cases where LCs/Inland LCs were opened prior, but retiring after the introduction of scheme on 17Mar20. TERF was introduced to provide a time-bound incentive for investment in all sectors.

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