KARACHI: According to figures released on Friday by the State Bank of Pakistan (SBP), Pakistan's current account deficit decreased by 86% year over year in November, reaching a 19-month low as tight controls, a slowing economy, and lower global commodity prices all contributed to a decline in imports.

November saw a $276 million deficit for the nation as opposed to a $1.929 billion deficit in the same month last year. The deficit decreased by 51% month over month from $569 million in October.

In November, total imports decreased 33% to $4.26 billion, while exports decreased 18% to $2.23 billion.

Fahad Rauf, head of research at Ismail Iqbal Securities, stated that the decrease in the trade deficit was the primary cause of the current account gap's closure. He noted that the absence of wheat imports and decreased petroleum imports—a result of lower world prices—had been the main drivers of the reduction in imports.According to the SBP's tweet, the current account deficit decreased by more than half between July and November, from $7.2 billion to $3.1 billion, with imports declining by $4.8 billion (-16%) and exports remaining largely unchanged.

The SBP's foreign reserves have decreased to $6.7 billion, which is not enough to cover a month's worth of imports and has caused a balance of payments crisis in the nation.

The government is attempting to relaunch an IMF bailout even as it battles to find the funds to pay off a mountain of foreign debt (IMF).

The government is requesting urgent financial assistance from Saudi Arabia.

For the current fiscal year 2022–2023, the SBP anticipates that the deficit would stay under $10 billion, largely due to a decline in the price of petroleum products on the international market.

Additionally, the SBP has made policy decisions that will dramatically lower some outflows.

Analysts predict that in FY23, the deficit will be $7.8 billion, or 2.1% of GDP, driven mostly by administrative actions taken by the central bank, a decline in demand, and a drop in world oil prices.

However, a fall in remittances, a decline in textile and food exports, and a slowing in the pace of IT exports will minimise the benefit of the decreased imports.