KARACHI: The country’s external account is performing well, posting the third highest monthly current account surplus of $ 619 million during March 2024.

Analysts said after a gap of nine years, Pakistan has achieved its highest monthly current account surplus supported by a jump in the home remittances amid Ramazan/Eid season and lower trade deficit. This surplus also marks the third highest monthly surplus in the history of the country.

According to the State Bank of Pakistan (SBP), the country’s current account recorded a surplus of $ 619 million in March 2024 compared to $537 million in March 2023. This is the second consecutive month in which the country has posted a surplus account. Previously, Pakistan posted a $98 million current account surplus in Feb-2024.

Cumulatively, the current account also improved significantly during the first nine months of this fiscal year (FY24) and recorded a massive decline of 87 percent. The country’s current account posted a deficit of $508 million in July-March of FY24 compared to $4.1 billion in the same period of last fiscal year (FY23).

Analysts said that a surplus current account will reduce the pressure on external accounts and foreign exchange reserves, which stood at $ 13.374 billion as of Apr 12, 2024.

During the second week of April, Pakistan made a repayment of one billion dollar against the 10-year Eurobond, however despite this payment, the SBP has successfully managed to maintain the reserves above the $8 billion level supported by healthy home remittances inflows and lower trade deficit.

Remittances arriving in March 2024 are the highest monthly inflows in 22 months and the country received workers’ remittances amounted to $3 billion, up by 31 percent during March 2024. In addition, Pakistan’s trade deficit has declined by 33 percent to $15.75 billion in the first nine months of this fiscal year.

For the past one year, the country is struggling to come out from a foreign exchange crisis and currently negotiations with the IMF for a long-term program, on completion of the IMF Stand-By Arrangement programme of $3 billion in April.

Copyright Business Recorder, 2024