Karachi: Alhamra Smart Portfolio announced its financial results for the year ending June 30, 2024, highlighting Pakistan's significant macroeconomic recovery. The turnaround was largely credited to the country’s successful engagement with a new IMF Stand-by Arrangement (SBA) of USD 3.00 billion secured in June 2023. The government's unwavering commitment to IMF targets allowed the program to be completed successfully, according to the portfolio's management report.

In August 2023, the caretaker government implemented immediate measures to address speculative pressure on the currency, resulting in an exchange rate spike to PKR 330/USD in the informal market. These efforts, including actions against smuggling and abuse of Afghan Transit, led to a rapid recovery in the exchange rate. The PKR closed the year at 278.3, appreciating by 2.6%. The government also implemented fiscal and administrative measures to manage external balances, ensuring stability.

Pakistan's current account deficit (CAD) shrank significantly during FY24, falling by 88% year-on-year to USD 464 million, compared to USD 3.8 billion in the prior fiscal period. The narrowing of the trade deficit was driven by an 11.3% increase in exports and a 2.3% drop in imports, reducing the trade gap by 17.0%. Foreign exchange reserves improved as well, closing FY24 at USD 9.4 billion, supported by inflows from the IMF and other multilateral sources.

Inflation remained a challenge, with the consumer price index (CPI) averaging 23.9% for FY24, only slightly down from 29.0% in the previous year. High energy and food prices were exacerbated by adjustments in electricity tariffs and gas prices to comply with IMF terms. The State Bank of Pakistan (SBP) responded by reducing the policy rate by 150 basis points, bringing it down to 20.5% in June 2024.

The nation's GDP grew by 2.4%, reflecting improvements in the agriculture sector, which grew by 6.3%, while services and industrial growth remained modest at 1.2%.

According to information available from the Pakistan Stock Exchange (PSX), the fiscal year also saw an increase in tax collection, with FY24 tax receipts rising by 29.6% to PKR 9.28 billion, although the target was missed by PKR 130.00 billion.