Pakistan: Staff Report for the 2006 Article IV Consultation

IMF Staff Country Reports, December 7, 2006

Source details

"The demand pressures associated with the large terms-of-trade gains are reflected in a fast real appreciation of the ruble, although more of this has come through nominal appreciation during the last year."
"The risks to the outlook are evenly balanced and depend mostly on oil price developments."
"Current policies raise medium-term risks."
"IMF staff welcomed the greater focus on inflation control, but cautioned that additional exchange rate flexibility would be needed to meet the end-2006 target, especially at a time when demand pressures are exacerbated by fiscal relaxation."

Fast real appreciation of the ruble driven by large terms-of-trade gains.
Recent appreciation has been largely nominal during the last year.
Outlook risks are described as evenly balanced.
Oil price developments are identified as the principal determinant of the outlook risks.
Current policy stance is assessed as raising medium-term risks.

Positive note: greater focus on inflation control welcomed by IMF staff.
Cautionary note: additional exchange rate flexibility would be needed to meet the end-2006 target.
Context for caution: demand pressures are exacerbated by fiscal relaxation.

Subjects: Balance of payments; Current account; Current account deficits; Expenditure; External debt; Public debt.
Keywords: authorities' objective; CR; Current account; current account deficit; Current account deficits; deficit; deficit-to-GDP ratio; Global; government; government debt-to-GDP ratio; ISCR; rate; reform agenda; U.S. dollar.

Pakistan: 2006 Article IV Consultation; Staff Report; IMF Country Report 06/426; November 1, 2006
- Pakistan: 2006 Article IV Consultation; Staff Report; IMF Country Report 06/426; November 1, 2006 (Markdown version)
- Pakistan: 2006 Article IV Consultation; Staff Report; IMF Country Report 06/426; November 1, 2006 (PDF)