Dollar free fall continues against rupee for third consecutive session
Stringent monitoring of banks and crackdowns have also strengthened the rupee
The Pakistani rupee continued its rally against the US dollar on Tuesday following the return of Ishaq Dar and Prime Minister Shehbaz Sharif’s visit to the United States.
The dollar was being traded at Rs234.11 in the interbank market while the open-market rate hovered around Rs236.
According to market analysts, Dar is considered an ‘expert’ in ensuring the rupee’s stability. On the other hand, stringent monitoring of banks and crackdowns on illegal money changers have also strengthened the rupee.
Moreover, experts claim that the possibility of receiving $2 billion from the World Bank and the government’s continuous efforts of postponing payments of foreign loans due to the recent floods has also slowed down the rapid increase in the dollar’s price.
Dar, who returned on Monday following a five-year period of ‘self-exile’, is expected to take the oath of the upper house of parliament today to become the new financial czar of the country.
Talking to the media after landing at Nur Khan Airbase, Dar said he has reached Pakistan on the instructions of the party leader, Nawaz Sharif and Prime Minister Shahbaz Sharif.
“We will take this country out of the economic vortex… we will take Pakistan out of the economic vortex like in 1999 and 2013-14, there is a lot of hope that we will go in a positive economic direction”.
The Pakistani rupee gained further ground as the US dollar continued its declining trend for the third consecutive session on Tuesday.
The dollar lost Rs3.11 against the rupee on Tuesday and closed at Rs233.91 in the interbank market at the end of trade session, after the local unit suffered consecutive losses during several sessions in the last trading week.
Interbank closing #ExchangeRate for todayhttps://t.co/6ofbsTsbB7 pic.twitter.com/9xD06V3Pgz
— SBP (@StateBank_Pak) September 27, 2022
The dollar has so far shed Rs5.15 in the interbank market, only two days into the trade week.
The local currency on Friday — the last trading day of the outgoing week — finally broke its losing streak against the dollar after continuously depreciating for 15 consecutive sessions.
The rupee came close to reaching a record low of 240 against the dollar but was unable to do so after several positive cues despite deadly floods devastating Pakistan’s economy.
Exchange Companies Association of Pakistan (ECAP) General Secretary Zafar Paracha had said it seems the market is responding to PML-N leader Ishaq Dar’s arrival and the announcement of him replacing Miftah Ismail as the finance minister.
Dar has returned to Pakistan after five years of self-imposed exile in London to “facilitate” the government in its efforts to resurrect a cash-strapped economy by taking over the key portfolio of the finance ministry.
Apart from Dar’s announcement, Paracha noted that the market players were noting political stability as well — after PTI Chairman Imran Khan stated he could return to parliament if the alleged cipher — purportedly containing threatening text behind his government’s ouster — is probed.
The ECAP general secretary also said that the announcement from the World Bank about repurposing funds, the International Monetary Fund’s (IMF) plans to help Pakistan, and the Asian Development Bank’s help have boosted hopes of the market.
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