Political Uncertainty and Its Impact on The Financial Markets of Pakistan

日期 : Sep 2023 - Jun 2024

<div><p>In this project, I explored the impact of political uncertainty on Pakistan's financial markets. The findings reveal a clear link between political instability and market volatility. During periods of uncertainty, investor confidence tends to erode. This can lead to capital flight, where investors pull their money out of the Pakistani market, causing a decline in stock prices. Furthermore, political instability can weaken the Pakistani Rupee against foreign currencies. This makes imports more expensive and discourages foreign investment. The project also identified potential fluctuations in interest rates, impacting borrowing costs and investment decisions. Businesses may delay expansion plans, and consumers might postpone major purchases. Ultimately, political uncertainty can create a drag on economic growth by hindering investor activity, potentially leading to job losses and slower wage growth. It's clear that a stable political environment is crucial for fostering a healthy and prosperous financial market in Pakistan.</p></div>