The Pakistan Stock Exchange (PSX) remained upbeat on Thursday, as investor sentiment significantly surged following the announcement of a landmark trade agreement between Pakistan and the United States. This positive development, coupled with ongoing optimism over macroeconomic stability and the central bank’s policy continuity, propelled the market upwards.
The PSX’s benchmark KSE-100 Index climbed to an intraday high of 140,077.85, marking a gain of 1,618.96 points, or 1.17%, from its previous close of 138,412.25. The index also touched an intraday low of 139,369.06, still up by 956.81 points, or 0.69%.
Independent investment and economic analyst AAH Soomro commented on the positive sentiment, stating, “Positive sentiment on US trade deal is a diplomatic success, especially when people compare higher duties on Indian export.” He added, “The hope is that US–Pakistan partnership continues strengthening, leading to economic stability under IMF.”
Landmark US-Pakistan Trade Agreement Sealed
In a significant diplomatic breakthrough, US President Donald Trump confirmed the finalization of a trade agreement between the two countries. This development signals a considerable boost in bilateral economic ties and comes at a pivotal time when India continues to face higher tariffs and geopolitical headwinds, partly due to its energy ties with Russia.
According to the Ministry of Finance, the agreement was successfully concluded during Finance Minister Muhammad Aurangzeb’s meeting with the US Secretary of Commerce and the US Trade Representative. Pakistan’s Ambassador to the US, Rizwan Saeed Sheikh, and Commerce Secretary Jawad Paul were also present at the meeting.
A statement from the ministry outlined the key objectives of the deal: to enhance bilateral trade, improve market access, attract investment, and strengthen cooperation in traditional sectors like energy and minerals, as well as emerging sectors such as IT and cryptocurrency. The agreement also includes tariff reductions on Pakistani exports to the US and aims to encourage US investment in Pakistan’s infrastructure and development projects, marking a fresh phase in economic cooperation between the two nations.
State Bank of Pakistan Maintains Key Policy Rate
Meanwhile, the State Bank of Pakistan (SBP) maintained its key policy rate unchanged at 11% during Wednesday’s Monetary Policy Committee meeting. This decision was made citing persistent inflation risks and pressures on the trade balance.
In its post-meeting statement, the SBP indicated that inflation projections had slightly worsened due to unexpectedly high gas tariff adjustments. However, it noted that price pressures are anticipated to stabilize within the target range moving forward. SBP Governor Jameel Ahmad, in a subsequent press conference, projected that inflation would likely remain between 5% and 7% during FY26, although temporary breaches above the upper band might occur in some months. He also added that the trade deficit is expected to widen as economic activity picks up.
On Wednesday, the KSE-100 Index had also seen a gain of 447.43 points, or 0.32%, closing at 138,412.25, up from 137,964.82 in the previous session. During that session, the index touched a high of 139,018.88 and a low of 137,658.81.
