The rupee continued to rise gains against the US dollar in interbank trade on Thursday, appreciating by 27 paise – a development attributed to government measures by the International Monetary Fund (IMF) to pave the way for release of loan tranches. is being held.
According to the Forex Association of Pakistan (FAP), the rupee rose by Rs 1.50 to Rs 203.90 by 1 pm from Rs 205.40 the previous day.
The closing rate of the FAP of the previous session was higher than the State Bank of Pakistan’s rate of Rs 205.12.
The greenback was trading 0.13 per cent higher at Rs 204.85 in the interbank market till the close of Thursday.
FAP President Malik Bostan told don.com That the rupee was showing a sharp correction against the dollar in recent days amid hopes that the IMF will soon release a fund of around $2 billion.
A report by web-based financial data and analytics portal Metis Global today linked the rupee’s appreciation to the government’s moves aimed at releasing loan tranches by the IMF.
However, the report said that experts are of the view that this appreciation in the value of rupee was “short-term due to prolonged uptrend of oil prices in the international market”.
On Wednesday (Yesterday), the National Assembly approved the Finance Bill for the upcoming financial year, with some major changes related to taxation and levies on petroleum products, in line with the government’s commitment to the IMF.
Earlier on Tuesday, Pakistan received the Memorandum of Economic and Fiscal Policies (MEFP) from the IMF for a joint seventh and eighth review of its $6 billion loan programme, which has been stalled since April.
The MEFP includes certain pre-actions that will be required for implementation before the IMF Board approves Pakistan’s case and subsequent disbursement of funds.
According to the MEFP, Pakistan will have to take at least two more “pre-actions” by the end of July or early August to secure the two joint tranches. Prior actions have included passing the federal budget as agreed with the IMF and presented to the National Assembly on 24 June and a memorandum of understanding duly signed by provincial governments to jointly provide about 750bn cash surplus to the Centre. to be done.
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Boston also blamed a Chinese consortium of banks for the rupee gains, which last week was crediting a $2.3 billion loan to SBP’s account.
“The dollar, which had hit Rs 212 in the interbank market, has now slipped below Rs 205, and it is expected that the currency will fall below Rs 200 in the first week of the new financial year,” he said.
Besides, he said, exporters had started bringing back their export proceeds to Pakistan after the appreciation of the rupee, which had improved dollar supply in the market.
He said that most of the people who were buying dollars, who wanted to go for Haj this year, had completed their preparations for the pilgrimage, after which there was a further fall in the demand for dollars.