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KARACHI: Pakistan’s current account deficit (CAD), the gap between exports and imports, has risen to a four-month-high in May despite a dip in imports, the Central bank data released on Tuesday revealed.
The CAD expanded to $1.4 billion in May 2021, a massive 133% increase month-on-month from $618 million in April 22. In May 21, the deficit stood at $640 million.
1/2 The current account deficit (CAD) rose to $1.4bn in May. While overall imports fell compared to April, a decline in remittances and exports on account of Eid holidays contributed to this rise. pic.twitter.com/pZcZpcZ1op
— SBP (@StateBank_Pak) June 28, 2022
According to the data, the CAD has increased despite a dip in imports which reduced to $5.6 billion in May from $5.9 billion in April 2022.
The State Bank of Pakistan said that “decline in remittances and exports due to Eid holidays” led to an increase in the CAD.
“The current account deficit (CAD) rose to $1.4bn in May. While overall imports fell compared to April, a decline in remittances and exports on account of Eid holidays contributed to this rise,” the SBP tweeted.
However, the deficits stood at a $1billion if in kind imports are excluded. In kind imports are fully financed, thus do not generate outflows from the SBP’s reserves.
However the exports in May 22 also to $2.48 billion from $3.15 billion in April. The year-on-year change in the exports stood at 17percent or $355 million.