Barclays, in a recent note, has showcased a positive outlook on the Pakistani economy, emphasizing the nation’s strengthened foreign reserves and asserting a low risk of repayment. This sentiment prevails even amid Pakistan’s ongoing efforts to secure a new loan from the International Monetary Fund (IMF).
The credit strategist at Barclays, based in Singapore, underscored that despite potential political noise, the risk associated with repayment is expected to remain low due to the country’s improved foreign reserves. The analyst further commented on the post-election scenario, anticipating that, for a Sharif-led government, the initial 12 months after elections would be relatively less disruptive. Conversely, a government-backed by the Pakistan Tehreek-e-Insaf (PTI) would likely prioritize its political agenda over economic concerns.
Barclays expressed confidence in the Pakistani government’s ability to fulfill its obligations regarding Eurobonds. However, it cautioned that if election results were to be dismissed, bond reactions could be negative. On a more stabilizing note, if a caretaker government were to be installed, Barclays anticipates a more favorable response.
Despite acknowledging existing challenges, Barclays has recommended considering the purchase of Pakistani bonds during a market dip. This positive stance aligns with their satisfaction with the country’s economic trajectory, marked by improved foreign reserves and a perceived low risk of repayment.
What is Barclays?
Barclays is a British multinational investment bank and financial services company. It is one of the largest and oldest banks in the United Kingdom, with a history dating back to the late 17th century. Barclays operates globally, offering a wide range of financial services, including retail banking, corporate banking, investment banking, and wealth management.
As an international financial institution, Barclays has a significant presence in various countries and serves millions of customers worldwide. It provides services to individuals, businesses, and institutions, offering products such as loans, mortgages, credit cards, investment products, and various banking and financial solutions.
