• Sun. May 26th, 2024

Pakistan’s Economy Expands by 1% Despite High Interest Rates and Weak Consumer Demand

BySamantha Jones

Mar 28, 2024
Record Interest Rates Cause Pakistan’s Economic Growth to Slow

Despite the record high interest rates affecting businesses and reducing consumer demand, Pakistan’s economy still managed to expand by 1% in the October-December period compared to a year ago, according to data from the Pakistan Bureau of Statistics. However, this was lower than the median estimate of 1.8% in a Bloomberg survey. The National Account Committee also revised upward economic growth for the previous quarter to 2.5% from 2.13%.

In terms of sectors, agriculture saw growth of 5.02% from a year ago, while industry contracted by 0.84%. The services sector grew by a minimal 0.01%. Despite efforts to avert a sovereign default last year, the economy has remained fragile. Prime Minister Shehbaz Sharif is seeking a new loan from the International Monetary Fund (IMF) to support the economy and bolster Pakistan’s foreign exchange reserves.

The IMF has lowered its GDP forecast for the current fiscal year to 2% from 2.5% due to weaker domestic demand, but the State Bank of Pakistan is more optimistic, citing better farming and industrial output supporting the economy. Last fiscal year, Pakistan experienced a rare contraction of 0.17%. The nation continues to heavily rely on IMF aid, with $24 billion in external financing needs in the fiscal year starting July, about three times its foreign exchange reserves.

By Samantha Jones

As a content writer at newsnnk.com, I weave words into captivating stories that inform and engage our readers. With a passion for storytelling and an eye for detail, I strive to deliver high-quality and engaging content that resonates with our audience. From breaking news to thought-provoking features, I am dedicated to providing informative and compelling articles that keep our readers informed and entertained. Join me on this journey as we explore the world through the power of words.

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