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As Pakistan's foreign exchange reserves dwindle a dollar black market emerges: Report

To safeguard the country's dwindling reserves, Pakistan's central bank recently placed restrictions on access to foreign currency. This as per recent reports has resulted in the emergence of a black market for dollars.

Pakistan's foreign reserves have reportedly plunged to a four-year low of $6.7 billion. 

As per Bloomberg, on the surface, this hasn't impacted the exchange rates, but once you delve deeper you come face to face with the reality. ....

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Dollar Black Market Booms as Pakistan Remains in Crisis

Dollar Black Market Booms as Pakistan Remains in Crisis
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Paradox of celebrating surpluses, regretting deficits


Paradox of celebrating surpluses, regretting deficits
Business
December 27, 2020
Current account surpluses/deficits are not an end/achievement in themselves. Rather, they are means to an end. In absolute sense, having surplus is indeed excellent. But, the problem starts when we think having such surpluses is some ultimate achievement in itself, and that the economy has been completely turned around. Unfortunately, this is not the correct way of looking.
For instance, we regret deficits while celebrate surpluses, mostly in isolation, where in fact the deficits may be incurred due to high economic growth (which is absolutely fine, and actually good when economy does not have enough capacity to fulfill domestic demand). So, imports satisfy demand that cannot be met through domestic means, hence higher chances of incurring large deficits, setting aside borrowing-consuming debate for a while. ....

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