Pakistan to seek International Monetary Fund bailout to overcome financial crisis

11 October, 2018, 10:06 | Author: Eric Barnett
  • Finance Minister Asad Umar speaks in a video message. — DawnNewsTV

IMF's forecasts for Hong Kong's economic outlook are mixed: it raises its forecast for 2018 by 0.2 percentage points to 3.8%, while cutting its forecast for 2019 by 0.3 percentage points to 2.9%.

The IMF has slashed its latest growth forecasts, downgrading the US, China, the eurozone and the United Kingdom, as tit-for-tat tariffs bite.

"US growth will decline once parts of its fiscal stimulus go into reverse", Mr Obstfeld said in a statement.

Global debt levels reached a record $182 trillion in 2017, having grown 50 per cent in the previous decade, but the picture looks less grim when public assets are taken into account, the International Monetary Fund said on Wednesday. It had previously predicted jobless rates of 5.5% and 5.2% respectively.

According to a media report, State Bank of Pakistan had viewed that the exchange rate of Rs137 to a dollar by the end of current fiscal year in June 2019 would be sufficient to address the challenges. These policies have contributed to a slowdown in economic growth, which is happening just as trade tensions with the US are starting to bite.

The IMF's warnings will increase fears that the present buoyancy in global growth may not last.

Russian Federation was among the few energy-rich emerging market countries whose growth forecasts were bumped up.


Last year, China shipped goods worth $375 billion more to the US than it took in from the United States, a figure Trump has often said he wants to curb sharply in an effort to promote American businesses.

"New vulnerabilities have emerged and the resilience of the global financial system has yet to be tested", the International Monetary Fund said in the latest Global Financial Stability Report.

"Where we are now is we've gotten some bad news. We are determined to understand the full details of what has happened and will communicate these to investors and stakeholders as soon as possible", said chairman Luke Johnson.

"We will be listening very, very attentively when and if they come to us", said Obstfeld.

The model also includes the effects of a reduction in business confidence that reduces investment and leads to a tightening of financial conditions.

A U.S. Treasury official on Monday repeated that the Trump administration was concerned about the yuan's recent weakening as the department prepares a semi-annual report on currency manipulation due out next week.

One of the International Monetary Fund (IMF)'s most detailed studies of the state of banking since the financial crisis reveals trade tensions are building and claims a "growing anxiety" around a breakdown in negotiations between Britain and the European Union could lead to financial uncertainty. The government has already hiked gas tariff on average by 35 percent and more could follow.

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