Karachi: Pakistan witnessed 87 percent of foreign investment withdrawal from treasure invoices (T-Factures) due to a strong reduction in earnings rates in almost seven months.
The returns of T invoices in half during the first seven months of the current fiscal year. These great exits occurred despite a stable exchange rate for more than a year.
Experts in the financial market said that many other factors could contribute to the exit of foreign investments from Tackers T.
According to the data of the Pakistan State Bank (SBP), T-Bills attracted an entry of $ 984 million from the beginning of July last year until January 17. In contrast, the departure reached $ 852 million during the period.
The strong decrease in the returns that are said to be behind a massive exit
T-Bills yields fell more than 50 percent since its 24 percent peak, mainly due to a strong fall in the interest rate since June 2024. The State Bank has reduced its policy rate by 1,000 basic points ( BP) to 12 percent.
In the last auction before the monetary policy announced on January 27, the Government further reduced tension rates in up to 41 bp for different tenors.
The performance of a 12 -month tenor was reduced by 41bps at 11.38pc compared to 49bps at the auction held on January 8, reducing the rate at 90bps to 11.38pc this month.
Market experts said that uncertainty regarding the debt service of $ 26.1bn in fiscal year 2015 is still there despite the statements of the authorities that most of this problem has been resolved.
Foreign investors are the most sensitive elements of any economy, since they leave the country before possible arrest in an economic trap, a banker said, adding that he witnessed during the Covid Pandemia when more than $ 4 billion left the country in A few months.
In the last auction held before monetary policy, the return of the 6-month T-Bills reference was further reduced in 39bps at 11.4pc.
Financial experts believe that T invoices are no longer attractive to foreign investors, since rates could decrease more after a 100 -bp cut in the interest rate.
The departure of foreign investment until January 17 was $ 121.5 million, higher than the entrance of $ 72 million in the same period.
It was also interesting to observe that $ 630 million, which represents 64 % of the total tickets of the yincientes for six and a half months, come from the United Kingdom with the largest exit of $ 457 million.
Other significant tickets in Tacades T during this period were $ 152 million from the EAU, $ 61 million from Bahrain and $ 52 million Australia.
Posted in Dawn, January 30, 2025