Abb Takk News

Pakistan’s Current Account Deficit Shrinks by 42% to $703m

KARACHI: The policies adoped to curtail the import ban have continued to bear fruit as Pakistan’s latest current account deficit — the gap between the country’s higher foreign expenditure and low income — shrank by a massive 42% month-on-month.

The current account deficit clocked in at $0.7 billion in August 2022 in comparison to a deficit of $1.2 billion in July, data released by the State Bank of Pakistan (SBP) showed.

“The current account deficit fell to $0.7 billion in August compared to $1.2 billion in July. The July-August FY23 current account deficit declines by $0.5 billion to $1.9 billion compared to same period [of] last year,” the central bank said in a brief note released on its Twitter handle.

“This was mainly due to increase in exports by $0.5 billion and contraction in imports by $0.2 billion.”

Analysts and financial pundits believe that the narrower deficit is the result of wide-ranging measures taken in recent months to moderate growth and contain imports, including tight monetary policy, fiscal consolidation and some temporary administrative measures.