It appears that debt market participants are cheerfully celebrating the victory of PML-N. Just like the overwhelming market participation witnessed in the first post elections T-bill auctions, PIB auctions conducted on May 22, attracted an incredible investor response.
On Thursday, most national newspapers carried a message from the Karachi Cotton Association (KCA), reiterating the bodys opposition to the introduction of a new product at the Pakistan Mercantile Exchange (PMEX).
Ever since the election, the market has been anticipating a rate cut - their anticipation quite evident by the dip in cut-off yields in the recently held T-bill and PIB auctions. From what it appears, the market is largely banking on a possible slowdown in inflation as the PML-N has hinted at staying away from the IMF in its initial days.
Now that the Election Commission of Pakistan (ECP) has officially notified the results from May 11 polls, perhaps it is time to take stock of what lessons these historic elections had to offer.
First up is the highest voter turnout witnessed since the 1980s, which indicates many positives. On one hand, it points towards a renewal of peoples faith in the democratic process. Despite the pre-poll violence and Election Day apprehensions, people decided to turn up.
The Chinese premier Li Keqiang is in town and Islamabad is buzzing with excitement. After all Pakistan is Chinas iron brother, whereas, China is Pakistans all weather friend. But bilateral economic relationship has yet to blossom.
With the country receiving loans for 29 years now, total external debt stands at a whopping $60.8 billion as of March, 2013. Considering the population of approximately 176.7 million, roughly each Pakistani is indebted $344 per head. And when domestic debt is taken into account, the per capita indebtedness soars to over $849 per head.
The Prime Minister of the United Kingdom David Cameron announced last week that hi government plans to launch a state-backed mortgage financing scheme, with a view to provide homes and generate jobs.
Here in Pakistan, the Prime Minister in-waiting, Mian Nawaz Sharif appears to be considering the introduction of a similar programme.