NewsJune 17 , 2022
Dollar Closes above Rs207 on Thursday
Karachi: The US dollar breached another record on Thursday as it rose past Rs207 in the interbank market on Thursday owing to concerns over depleting foreign exchange reserves and ambiguity regarding Pakistan's deal with the International Monetary Fund (IMF).
According to the Forex Association of Pakistan (FAP), the greenback appreciated Rs1.45 from the previous day's close of Rs206.40 and climbed to Rs207.85 by closing time. On Wednesday, it had appreciated by Rs1.30.
In the open market, the dollar was trading at Rs208.5 on Thursday.
Asad Rizvi, former treasury head at Chase Manhattan Bank, outlined the rapid decline in the country's foreign exchange reserves as the main factor pressuring the rupee. "The urgency is to get the house in order per the IMF."
During the week ending June 3, liquid foreign exchange reserves of the State Bank of Pakistan declined by $497 million to $9.2 billion.
He claimed that the government's measures of increasing the prices of petrol, electricity, and gas were not enough. "It will have to take more tightening measures in terms of abolishing subsidies, reducing the deficit, and imposition of additional taxes."
Rizvi stressed the need to resolve minor issues such as the 9 per cent tax to GDP ratio, 79 per cent GOP holdings, and 53 per cent advance deposit ratio so that the economy could get back on track.
Meanwhile, Tresmark's research head Komal Mansoor said that the market would stay anxious until the IMF deal has concluded. "That will also unlock other multilateral flows."
"It looks like the rupee may bottom out below the Rs210 level as many exporters are eager to look forward now,” she predicted… - Dawn
Courtesy https://www.dawn.com
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