Finance: Slowly fixing the economy

Emboldened by a marked improvement in key economic indicators, apart from GDP growth, the country’s leadership now signals a shift from crisis management toward transformative growth. Both Finance Minister Muhammad Aurangzeb and State Bank of Pakistan (SBP) Governor Jameel Ahmed have recently talked about the transformation of the Pakistani economy as their next goal. While macroeconomic indicators suggest tentative improvement, the real test lies in whether this rhetoric can translate into genuine, systemic reform. One of the clearest signs of change is in Pakistan’s exchange rate regime. For decades, the policy pendulum swung between artificial overvaluation and abrupt depreciations — breeding uncertainty for businesses and draining foreign reserves. In contrast, SBP’s recent firm stance on a market-driven rupee marks a fundamental departure from the past.