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Finance Minister's take on Revenue, Rupee & Current Account Deficit
Revenue: “We have proved that our strategy of revenue generation is better than the one prescribed by the fund,” says the Finance Minister.
Rupee : Mr Minister thinks "speculators" created "artificial demand" due to Balance of Payment worries. But also "this is not sustainable & has no base". He was quick to highlight one-off imports of $450m of vaccine.
SBP intervention: Such an statement, warrants expectations that Rupee slide will stop. On SBP's prospective intervention, Mr Minister believes "SBP is watching the situation and will intervene when required" and did highlight REER at 98.
Current Account Deficit: “We will review in case there are unnecessary imports,”. Growth in Automobile imports also is something that is being looked at & may see additional duty on luxury ones.
To conclude, heads are rolling to bring confidence back for businesses on the Trade Deficit & Rupee's outlook. For medium term - until election - stability, going back to IMF on a middle ground is a must.
It does seem the government is paying heed to the risks. That's a sigh of relief. It's time for more risk-taking & stock-picking.
https://www.dawn.com/news/1645909/talks-with-imf-for-sixth-tranche-to-start-by-month-end