The state bank of Pakistan has reported that the size of current account deficit (CAD) has shrunk by 73 per cent in the first month of this fiscal year. According to the report the CAD plunged by 72.81pc to $579 million in July, as compared to $2.13 billion in same period of 2018-19. This was in line with the downward trend witnessed throughout 2018-19 when the deficit stood lower by 31pc to $13.58bn, from $19.8bn in FY18 – recording a decrease of $6.3bn.
According to the July data, exports jumped 10pc to $2.233bn, as compared to $2.012bn whereas imports plunged to $4.08bn, from $5.497bn in same month last year. As a result, balance of trade in goods fell to $1.847bn, as against a deficit $3.485bn. The balance of trade in services, on the other hand, went down 8.5pc to $473m, from last year’s level of $517m
Bankers say the fall in CAD will help bring some stability to exchange rate and support for both import-reliant and domestically sufficient manufacturers.