Tiger & Tariffs

Tresmark: In 2008, Tiger Woods was at the peak of a successful golf career. His car crash that year, however, became a turning point — a personal and professional train wreck.

But almost instantly, the spin machine kicked in. PR teams, loyal fans, and media outlets began shaping a new narrative:
– “It’s a much-needed reset.”
– “We’re finally seeing the real, human Tiger.”
– “This fall was necessary for a greater rise.”
But behind all this, the truth unravelled — multiple affairs, a broken family, and years of lost focus, lost sponsorships, and lost legacy. It wasn’t a fresh start — it was a deep fall.
Now, the news of 19% tariffs is being celebrated — praising the diplomacy, with some even calling it a breakthrough. But the reality?
– Yes, the original proposal was 29%. But Bangladesh, Vietnam, Sri Lanka – all landed at 19–20% too.
– And they negotiated hard, with actual sectoral leverage — whereas we dropped our own tariffs to 0% on numerous items.
– Add to that: a new U.S.–Pakistan energy partnership to develop what Trump called Pakistan’s “massive oil reserves.”

So dressing “average” as “amazing” still hurts our exporters and local manufacturers — especially with rising electricity prices and the cost of doing business.

And just like the scandal that unravelled after the car crash, we won’t know the real impact until we see the details of this energy partnership.

A key take away: This deal, by the way, was unveiled just hours after a 25% tariff was imposed on Indian imports, underscoring the geopolitical angle — positioning Pakistan as a strategic alternative in the region.

Currency Outlook: A Pause, Not a Pivot
Luckily, the USDPKR didn’t crash — it remains relatively stable in the 282/283 range, which aligns with our expectations, even though the market was whispering 278/280.
At a time of tariff tantrums, a stronger currency is just NOT what the doctor ordered. In fact, it could become a strategic tool in the Central Bank’s toolkit — helping offset some of the 19% tariffs.
That said, we expect currency rates to remain range-bound this month. Swaps have also consolidated, however exporter interest has once again dwindled.

Policy Rate: Why the Hold?
It’s likely this cautious view around tariffs and geopolitical uncertainty that pushed the MPC to keep the policy rate unchanged, because nothing else makes sense.

But does this mean death to growth? Not quite — it’s just taken the back seat for now. Once we see more market stability, we expect more assertive, growth-friendly policies to emerge.

Bond Market: Reading Between the Bids
Interestingly, the bond market doesn’t believe in the policy rate freeze for long — as seen by the massive participation in yesterday’s PIB auction.

That’s a positive signal:
– For borrowers, it hints at lower future rates
– For the market, it helps diversify portfolio duration more effectively

All Eyes on Fed
– Fed to Hold Rates Steady: The Fed is expected to pause for the fifth time, but markets are watching Powell’s press conference for any hint toward a September rate cut.
– Subtle Signals Matter: A shift in Powell’s language from “restrictive” to “sufficiently restrictive” could be a green light for easing, especially with inflation cooling.
– Markets on Edge: A dovish tone may boost equities and weaken the dollar, while vague or cautious messaging could lead to volatility across markets.

Projections USD/PKR
• 1 Week: 282.50
• 1 Month: 283.50
• 1 Quarter: 284.00
EUR/USD
• 1 Week: 1.1428 (Bearish)
• 1 Month: 1.1609 (Sideways)
• 1 Quarter: 1.1750 (Bullish)
GBP/USD
• 1 Week: 1.3178 (Bearish)
• 1 Month: 1.3554 (Bullish)
• 1 Quarter: 1.3739 (Bullish)
USD/JPY
• 1 Week: 149.82 (Bullish)
• 1 Month: 145.26 (Bearish)
• 1 Quarter: 143.32 (Bearish)
Oil WTI
• 1 Week: 68 (Bullish)
• 1 Month: 69.17 (Bullish)
• 1 Quarter: 67.31 (Sideways)
Gold
• 1 Week: 3278.33 (Bearish)
• 1 Month: 3300.83 (Sideways)
• 1 Quarter: 3371.83 (Bullish)