{"id":35346,"date":"2018-06-22T05:13:09","date_gmt":"2018-06-22T10:13:09","guid":{"rendered":"http:\/\/olduvai.ca\/?p=35346"},"modified":"2018-06-22T05:13:09","modified_gmt":"2018-06-22T10:13:09","slug":"pakistan-panic-3rd-currency-devaluation-in-2018-sends-sovereign-risk-soaring-above-argentina-ukraine","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=35346","title":{"rendered":"Pakistan Panic: 3rd Currency Devaluation In 2018 Sends Sovereign Risk Soaring Above Argentina, Ukraine"},"content":{"rendered":"
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Pakistan Panic: 3rd Currency Devaluation In 2018 Sends Sovereign Risk Soaring Above Argentina, Ukraine<\/span><\/a><\/h3>\n<\/div>\n
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While many of the world’s eyes are on the carnage in Argentina as EM collapses, Pakistan has quietly devalued the Rupee three times this year,<\/strong> amid tumbling reserves which has sparked enough investor anxiety to send CDS spiking.<\/strong><\/p>\n

Pakistan is now ‘riskier’ than Greece, Ukraine, and Argentina…<\/p>\n

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The country has been roiled by domestic political and economic turmoil and was not helped this week when Moody\u2019s changed the outlook on Pakistan to negative from stable citing heightened external vulnerability risk.<\/p>\n

Moody\u2019s affirmed its B3 rating<\/p>\n

Says foreign exchange reserves have fallen to low levels and will not be replenished over the next 12-18 months, absent significant capital inflows.<\/strong><\/p>\n

Moody\u2019s says low reserve adequacy threatens continued access to external financing at moderate costs, in turn potentially raising government liquidity risks.<\/p><\/blockquote>\n

It certainly looks like they are losing control of the currency…<\/p>\n

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And to pile on – Pakistan’s main stock index – down 33% YTD in USD terms – just suffered a ‘death cross’…<\/strong><\/p>\n

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Notably all of this carnage has accelerated since the start of January which coincided with Pakistan’s decision to ditch the dollar<\/a>(following Trump’s remarks)<\/strong> and get closer to China.<\/p>\n

“SBP has already put in place the required regulatory framework which facilitates use of CNY in trade and investment transactions,” the State Bank of Pakistan (SBP) said in a\u00a0press release late Tuesday,\u00a0ensuring that imports, exports and financing transactions can be denominated in the Chinese currency.<\/p>\n

“The SBP, in\u00a0the capacity of\u00a0the policy maker of\u00a0financial and currency markets, has taken comprehensive policy related measures to\u00a0ensure that imports, exports and financing transactions can be denominated in\u00a0yuan,”<\/strong> Dawn news, Pakistan’s most widely read English-language daily, announced while quoting the SBP press release.<\/p><\/blockquote>\n

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\nImage source: WION News<\/em><\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Pakistan Panic: 3rd Currency Devaluation In 2018 Sends Sovereign Risk Soaring Above Argentina, Ukraine While many of the world’s eyes are on the carnage in Argentina as EM collapses, Pakistan has quietly devalued the Rupee three times this year, amid tumbling reserves which has sparked enough investor anxiety to send CDS spiking. Pakistan is now […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[1099,325,1745,20605,4318],"class_list":["post-35346","post","type-post","status-publish","format-standard","hentry","category-economics","tag-currency-devaluation","tag-foreign-exchange-reserves","tag-pakistan","tag-rupee","tag-zerohedge"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/35346","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=35346"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/35346\/revisions"}],"predecessor-version":[{"id":35347,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/35346\/revisions\/35347"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=35346"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=35346"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=35346"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}