Friday, August 05, 2022

Pakistani rupee's uptrend continues against dollar, appreciates by 0.94%

Rupee gains 2.11 against US dollar at close of interbank market, reaches 224.04

A trader places fresh notes on the counter in Pakistan. — AFP/File
A trader places fresh notes on the counter in Pakistan. — AFP/File

  • Rupee appreciates 2.11 against dollar.
  • PKR reaches 224.04 at close of interbank market.
  • Miftah says import ban to strengthen rupee.

KARACHI: The Pakistani rupee continued to strengthen against the US dollar for the sixth consecutive session in the interbank market on Friday.

The rupee appreciated 2.11 or 0.94% against the dollar during the day's trade and reached 224.04, down from Thursday's close of 226.15.

The rupee's uptrend comes after the government's belt-tightening measures, which led to a massive increase in inflation but also saved the country from an economic catastrophe.

Finance Minister Miftah Ismail, in his address at an event at the Pakistan Stock Exchange (PSX), said that if the country will be able to control imports, exports can be boosted through various measures.

Noting that Pakistan was "on the right track" after the coalition partners took unpopular decisions, Miftah said due to a decrease in imports, the pressure on the rupee will decrease further in the coming days and it will appreciate against the dollar.

Data from the Pakistan Bureau of Statistics (PBS) has shown that imports have plunged by 38.3% over the previous month as a sizable cut in imports was witnessed after the government banned a number of luxury items to manage the shortage of dollars in the economy.

Not only did imports decrease, but exports, too, witnessed a plunge. However, pressure on the rupee eased as the trade deficit reduced by 18.3% to $2.64 billion in July 2022 against $3.235 billion in July 2021. In June 2022, the gap was at $4.96 billion.

Experts have linked the currency's gain not just to depleting imports, but also to Chief of Staff Army (COAS) General Qamar Javed Bajwa's recent call to US Deputy Secretary of State Wendy, International Monetary Fund's (IMF) positive statement on loan disbursement, and political stability.