Pakistan’s currency plunges as it seeks International Monetary Fund loan

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The report comes on the eve of the October 12-14 meetings in Bali, Indonesia, of the International Monetary Fund and its sister lending organization, the World Bank.

Conditions in Europe and other major advanced economies also have remained "relatively easy", although investors have pushed back their expectations for the European Central Bank to lift interest rates, the report said.

Prime Minister Imran Khan made the decision on Monday after meeting with top economic advisers, Umar said in the interview.

The IMF as usual urged emerging economies to accelerate structural reform measures to strengthen their economic fundamentals in the long term.

"It's tempting to be a bit depressed about this perspective but I'm actually hopeful because there is a clear appetite to improve and expand trade", she said.

In a press conference at the White House on Tuesday, President Trump said "China wants to make a deal and ... they're not ready yet", adding that is a reason his administration has canceled a couple of meetings with Beijing.

It also said inflation in India is on the rise, estimated at 3.6 per cent in fiscal year 2017/18 and projected at 4.7 per cent in fiscal year 2018/19, compared with 4.5 per cent in fiscal year 2016/17, amid accelerating demand and rising fuel prices.

With weakening growth and uncertainties over trade, smoothing the economic impact of structural adjustments and de-risking "is a very hard act of judgment that policymakers in China have to struggle with", Vitor Gaspar, director of the IMF's fiscal affairs department, told reporters at a separate briefing on its Fiscal Monitor, a report that tracks the state of countries' public finances.

He contended that China had "already retaliated" against his tariff increases.

The government now will have to increase regulatory duties (RD) and customs duty (CD) on imports to contain trade deficit.

He said: "It is good for development to be able to participate in global capital markets to fund things like infrastructure projects and to sustain investment in countries".

But the United States organisation's study stresses that despite the Brexit uncertainty, banks are still safer now than they were in 2008 after the financial crisis. He said the previous PML-N government had started its term in 2013 with a $3 billion current account deficit, but his government inherited $18 billion current account deficit. It has also loaned billions to Pakistan to help ease the pressure on the foreign currency reserves, which are used to defend the currency. The last time was in 2013, when Islamabad got a $6.6 billion loan to tackle an economic crisis.

If an assistance package is agreed on, it would be Pakistan's second International Monetary Fund bailout in five years and its 13th since the late 1980s.

The IMF fears this could lead to sharp falls in markets.