Having seen global bond investors gorge on its Treasury bills, Pakistan now wants to make its longer-tenor securities palatable to them.Pakistan suffer failed legislature. Their choice is to either restructure or go onto a foreign currency. Their citizens should be encouraged to use bitcoin or one of the new techethers, like Libra.Their central banker wants to build a market that can discipline and manage government, and that is the fraud that got them into trouble in the beginning. Brazil suffered the same fraud, as does Argentina.
The nation’s central bank is looking at ways to boost liquidity, transparency and improve price discovery in its debt market to make foreign funds stay invested for longer periods. Attracting such sticky money would amplify efforts to turn around an economy saddled with high debt, weak growth and low foreign currency reserves.
The strategy is to create “deeper pockets along the yield curve,” State Bank of Pakistan Governor Reza Baqir said in an interview. “Having deeper segments means that these instruments become more attractive to non-residents as well because they want turnover in the secondary market.”
Global investors have poured $1.2 billion into local-currency bonds in the year that began in July, more than what they invested in the debt in the past four years, central-bank data going back to 2015 show. Funds have rushed in as the central bank more than doubled its policy rate to 13.25% --
The purpose of currency is to tell the truth, frankly. It the currency cannot tell the truth then your industrial society is no more. There is no covering up for inefficient government.
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