Pakistan’s current account deficit (CAD) was recorded at $1.4 billion in May 2022, showing a jump of 2.3 times when compared to a deficit of $618 million in April 2022, mainly due to a decline in remittances and exports on account of the Eid holidays, said the State Bank (SBP) on Tuesday on Twitter.
Overall imports also fell when compared to April 2022.
“Moreover, excluding in-kind imports that are fully financed and thus do not undermine the sustainability of the CAD, the deficit was more modest at $1bn,” it added.
According to the latest data released by the SBP, CAD surged by 2.2 times YoY against the deficit of $640mn reported in the same month last year.
Cumulatively, the current account witnessed a deficit of around $15.2bn during July-May 2022 as opposed to $1.18bn in the corresponding period last year.
According to the details made available by the central bank, the trade deficit in goods increased by around 12% MoM to $3.18bn in May 2022 as exports of goods declined by 21% MoM while imports saw a drop of 6% MoM. However, the trade deficit in goods jumped by 13% YoY in the said month.
Meanwhile, the trade balance in services, while still negative, inched up by 4% MoM to $380mn courtesy of a 14% MoM increase in imports while the exports went down by 20% MoM.
On year-on-year, the trade deficit in services went up by around 3 times YoY.
It is worth noting that workers’ remittances, the backbone of the country’s economy, witnessed a drop of 25% MoM, clocking in at $2.33bn in May 2022 from $3.13bn in April 2022 owing to the Eid holidays.
On a cumulative basis during July-May FY22, remittances by overseas Pakistani moved up by 6% YoY to $28.4bn from $26.74bn recorded in 11MFY21.