The International Monetary Fund has told Bloomberg that it plans to disburse $1.4 billion in emergency financing next week to help Pakistan shield its economy hit by the coronavirus outbreak.
The priority is to move ahead with the rapid financing instrument that Pakistan requested to fight the novel coronavirus pandemic, International Monetary Fund resident representative Teresa Daban Sanchez told Bloomberg.
IMF took to Twitter to reveal that the fund and Pakistani authorities are working expeditiously for the approval by the Executive Board and disbursement of the Rapid Financing Instrument to confront the COVID-19 shock. The Pakistani authorities remain committed to EFF policies and reforms.
The IMF and Pakistani authorities are working expeditiously for the approval by the Executive Board and disbursement of the Rapid Financing Instrument to confront the COVID-19 shock. The Pakistani authorities remain committed to the EFF policies and reforms.
— IMF Pakistan (@imf_pakistan) April 9, 2020
The loan will help boost the nation’s foreign exchange reserves that fell by about 13% in March, the biggest monthly drop in almost a year noted Bloomberg.
In response to this news, the benchmark KSE-100 Index, which saw its worst month in history as it dropped by 37% March 2020, appreciated by 3.3% or 1021 points and was trading at 31,993 points at 13:58 pm local time.
The rupee during the early trade also gained 0.3% to 167.25 per dollar.
A.A.H Soomro, managing director at Khadim Ali Shah Bukhari Securities while talking with ProPakistani stated,
The market greened today because of the early disbursement of the IMF package. People got slightly disappointed when the previous EFF tranche was delayed. Moreover, the cut in a T-Bill auction yesterday is also making people excited about a probable +50bps cut in the next meeting.