Pakistan's Currency Plunges Against U.S. Dollar As It Seeks IMF Bailout

US / China trade war and Brexit threaten global growth says IMF

"We continue to closely monitor developments in the yuan; we remain concerned about the recent depreciation of the yuan", said the official, who spoke on condition of anonymity.

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

But Lagarde added that uncoordinated developed-country rate hikes were contributing to destabilising capital outflows from emerging markets.

The ongoing trade war between the US and China could start having material effects on the economies of both countries within the coming years, according to new projections from the International Monetary Fund (IMF).

Khan's decision came after the Pakistani stock markets tumbled by 3.4 percent on Monday after Khan said the day before that he was still exploring options outside the International Monetary Fund.

A similar warning was also conveyed by the IMF "Global Financial Stability Report" released last week, pointing out that the tightening United States' monetary policy, coupled with trade uncertainties, have discouraged capital inflows to emerging economies, weakened their currencies and depressed equity markets.

Lagarde told her audience on October 10 that she did not feel overly gloomy about global conditions.

"I think the Fed is making a mistake".


Last year, China shipped goods worth $375 billion more to the US than it took in from the United States, a figure Trump has often said he wants to curb sharply in an effort to promote American businesses.

The government now will have to increase regulatory duties (RD) and customs duty (CD) on imports to contain trade deficit. In 2017, India had recorded a 6.7 per cent growth rate.

US President Donald Trump has frequently accused China of interfering with the exchange rate, though until now the Treasury Department has never determined that China meets the criteria to be labelled a currency manipulator.

The situation is similar to 2013, when after the elections, the new government in Pakistan obtained $5.3 billion from the International Monetary Fund to reinvigorate its ailing economy.

That would include boosting foreign currency reserves that could be used in a crisis, as well as working with local bond markets to build a local investor base, rather than relying on financing from overseas.

The Fund cited a number of other near-term risks to financial stability including the possibility of a "no-deal" Brexit or renewed fiscal policy concerns in some highly indebted euro area countries.

The global body, in its World Economic Outlook, also downgraded its growth forecast for India for 2019-'20 from 7.5% to 7.4%.

Despite the Federal Reserve's interest rate increases, financial conditions "have eased further" in the U.S.as equity valuations have stayed lofty.

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