For the sixth session in a row, the Pakistani rupee appreciated versus the US dollar on Thursday during intraday day activity in the interbank market.
In relation to the dollar, the rupee increased by 5.79 and closed at Rs. 223, down from Rs. 228.80 on Wednesday. The dollar dropped by 9.8 or 4.19 percent the previous day, which led to a substantial increase in the rupee.
Malik Bostan, the chairman of the Exchange Companies Association of Pakistan (ECAP), said on Geo Pakistan that the previous administration’s promises would take time to fulfil. However, this time, just a few days after Finance Minister Miftah Ismail stated that Pakistan’s import bill would decrease, it actually decreased by $2 billion.
According to data from the Pakistan Bureau of Statistics (PBS), imports have decreased by 38.3 percent over the past month as a result of the government’s decision to ban a variety of luxury goods in order to address the country’s cash deficit.
The decline in imports was accompanied by a decline in exports as well. The trade deficit decreased by 18.3% to $2.64 billion in July 2022 from $3.235 billion in July 2021, easing pressure on the currency. The shortfall was $4.96 billion in June 2022.
In addition, Chief of Staff Army (COAS) General Qamar Javed Bajwa recently called US Deputy Secretary of State Wendy Sherman to revive the IMF loan scheme.
Bostan claimed that immediately after this, the lender declared in a statement that Pakistan had met all requirements for the combined seventh and eighth reviews of the Extended Fund Facility, demonstrating the importance of the army chief’s call.
A board meeting is provisionally scheduled for late August after sufficient finance assurances are secured, according to a statement released on Tuesday by Esther Perez Ruiz, the IMF’s Resident Representative for Pakistan.
Bostan claimed that should the IMF release the $1.2 billion later in August, the dollar might drop to between 190 and 180 to the Pakistani rupee and continue to set new records.
“This was the actual level of the dollar. Before the political instability in the country and the Punjab by-elections — which upset everything, including the markets — the dollar wasn’t at such highs,” he said.
Eearlier there were fears about whether the government might survive or not, but now, after the Election Commission of Pakistan’s verdict on PTI’s prohibited funding, the coalition has decided to approach the Supreme Court — signalling that it is here to stay, Boston added.