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Pakistan's Stocks Surge Amid Rate Cuts and Surplus

10/5/2025

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Story summary
  • Pakistan's stock market hits new highs as fundamentals improve and rates fall.
  • State Bank cuts policy rate to 11%, boosting equities over cash.
  • Current account surplus about $2 billion, first in 14 years.
  • Risks remain, including tight external financing, fiscal consolidation fatigue, geopolitical uncertainties.
  • Analysts view the rally as cyclical, not a bubble, urging reforms and International Monetary Fund (IMF) guidelines.