Business

Dollar price in Pakistan rises by Rs2.25, crosses Rs 200 mark

Dollar price in Pakistan rises by Rs2.25, crosses Rs 200 mark

On Monday, the US dollar gained more than Rs2 in the interbank market, crossing the Rs200 barrier, with analysts predicting that the rupee will continue to decline as outflows for oil payments and other imports continue, while issues with the International Monetary Fund (IMF) remain unresolved.

The greenback gained Rs2.25 around 2:15pm, reaching Rs200.40 against a previous closing of Rs198.15, according to the Forex Association of Pakistan (FAP).

By noon, the value of the dollar had climbed to Rs200 on the open market.

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The rupee began to fall against the dollar early in the session today, prompting FAP Chairperson Malik Bostan and Exchange Companies Association of Pakistan General Secretary Zafar Paracha to point out that the greenback’s demand had surged due to today’s oil payments.

Banks, according to Paracha, were manipulating the dollar’s rate, leading to the local currency’s depreciation.

Asad Rizvi, a former treasury head at Chase Manhattan, told Mettis Global, a web-based financial data and analytics platform, that the situation would continue tumultuous until the budget is passed and the IMF approves the reopening of Pakistan’s loan facility.

The rupee began to fall against the dollar early in the session today, prompting FAP Chairperson Malik Bostan and Exchange Companies Association of Pakistan General Secretary Zafar Paracha to point out that the greenback’s demand had grown as a result of today’s oil payments.

Paracha also claimed that banks were rigging the dollar rate, adding to the local currency’s depreciation.

Asad Rizvi, a former Chase Manhattan treasury head, told Mettis Global, a web-based financial data and analytics platform, that the situation would continue tumultuous until the budget and the IMF’s clearance for the reopening of Pakistan’s loan facility.

According to Tresmark’s head of research, Komal Mansoor, “There is a backlog of outflows in the market that must be cleared by the end of June, including dividend repatriation and debt repayments.

“”For the next few weeks, this will continue to put pressure on the local currency,” she said.

After shattering the rupee’s five-day winning streak on Friday, the dollar has continued to rise against the rupee for the second consecutive day.

The rupee began rising versus the US dollar on May 27 and continued to do so for five straight sessions, according to data supplied by the State Bank of Pakistan. This came after the dollar had been steadily rising due to the country’s rising imports, dwindling foreign exchange reserves, and the uncertainty surrounding the country’s future.

The dollar had reached a new all-time high of Rs200 on May 19, and the rupee had only found relief after the government raised petroleum prices by a whopping Rs30 per litre, paving the door for the release of a $1 billion tranche from the International Monetary Fund. Following that, the greenback dropped Rs2.25 in a single session to Rs199.76 on May 27.

Currency dealers said the dollar’s comeback on Friday, after losing ground versus the rupee for five days, was only temporary and linked it to oil price shocks that would raise inflation.

However, they told Dawn that expected inflows from the IMF and China could bolster the local currency once more.

Finance Minister Miftah Ismail voiced optimism for an agreement with the IMF and a rollover of a $2.3 billion Chinese loan, which would help the country’s foreign exchange reserves.

Read more on Latest Business News on Pakistanlounge.pk

 

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Business

Sibtain Ali is a Senior Editor Business at Pakistan Lounge and joined in October 2021. Formerly business editor at a renowned International News website

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