Pakistani stocks jump over 2% as government ends fuel price freeze

The new price of petrol will be 179.86 rupee per litre and diesel will be 174.15 rupee. Reuters reported earlier on Thursday that the IMF and Islamabad had reached a deal to release over $900 million in funds, once Pakistan removed the fuel subsidies and hiked prices, according to a Pakistani source directly involved in talks in Qatar that concluded on Wednesday.


Reuters | Islamabad | Updated: 27-05-2022 11:34 IST | Created: 27-05-2022 11:30 IST
Pakistani stocks jump over 2% as government ends fuel price freeze
Representative image (file photo) Image Credit: ANI
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Pakistani stocks jumped more than 2% shortly after opening on Friday, reacting positively to an overnight decision by the government to end a months-old freeze on fuel prices. Pakistan late on Thursday announced it would hike fuel prices so that it can resume receiving aid from a $6 billion package signed with the International Monetary Fund (IMF) in 2019.

"The market is reacting to the government's move to withdraw fuel subsidies," Saad Hashemy, executive director at BMA Capital Management, told Reuters. "It shows the government's resolve to address teething issues in the economy and will pave the way for the IMF program and other funding sources." Fuel prices rose 20% on Friday, causing long lines to form at filling stations as the news spread. The new price of petrol will be 179.86 rupees per liter and diesel will be 174.15 rupees.

Reuters reported earlier on Thursday that the IMF and Islamabad had reached a deal to release over $900 million in funds, once Pakistan removed the fuel subsidies and hiked prices, according to a Pakistani source directly involved in talks in Qatar that concluded on Wednesday. The IMF has said that considerable progress had been made in the talks, but emphasized the urgency for Pakistan to remove fuel and energy subsidies to get back on track.

The benchmark stock index was 2.26% higher at 0544 GMT, according to exchange data. Pakistan's currency also rebounded against the dollar on Friday, traders said, following days of declines amid dwindling foreign exchange reserves and speculation that the IMF deal was in trouble.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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