The Pakistan Stock Exchange (PSX) ended August on a strong note, with the KSE-100 index touching a record 150,591 points before settling at 148,618, gaining 9,227 points month-on-month.
This historic rally was supported by robust institutional inflows, solid corporate earnings, and positive economic signals, as Moody’s upgraded Pakistan’s rating to Caa1 due to fiscal consolidation, IMF-backed reforms, and stronger external buffers.
Although the market saw volatility during rollover week, it regained momentum on Friday, surging 1,274 points. Overall, the month’s performance reflected strong local buying despite foreign investors posting net outflows of $43 million.
The Ministry of Finance reported the fiscal deficit narrowing to 5.4% of GDP, improving from 6.8% last year, while rising tax and non-tax revenues outpaced expenditure growth, boosting investor confidence further.
Additionally, the current account deficit dropped to $254 million in July 2025, a 37% yearly decline. Inflation edged up to 4.1% in August, compared to 3.2% in June, reflecting controlled price pressures.
Market experts noted that new additions to the MSCI Frontier Markets Index, along with foreign loan approvals and debt repayments, signaled improving stability, helping the PSX sustain its record-breaking momentum into September.