On Wednesday, investment bank JPMorgan called the slump in Pakistan’s bonds to just a third of their face value justified. He made the remarks following the country’s devastating floods and recent warnings by officials that some debt payments may need to be suspended. “Pakistan’s debt and fiscal dynamics flag rising solvency concerns,” JPMorgan’s analysts wrote. “Political/fiscal, flood-related external risks and the possibility of a debt moratorium and their implications on the IMF program as well as FX liquidity likely justify current sovereign bond prices,” he added.
