KARACHI:
The Pakistani currency on Monday hit a nearly five-and-a-half-month high of Rs 278.63 against the US dollar in the interbank market, maintaining its bullish trend for a fourth consecutive business day amid talks with the International Monetary Fund (IMF). for the release of the last installment of the loan and for a new program.
According to State Bank of Pakistan (SBP) data, the rupee appreciated 0.03%, or Rs0.11, against the dollar on a daily basis compared to Friday’s close of Rs278.74/$.
The local currency has appreciated cumulatively by 10.21%, or Rs 28.47, in the last six months compared to the all-time low of Rs 307.10/$ struck in the first week of September 2023.
The Exchange Association of Pakistan (ECAP) said the rupee remained flat at Rs 281.20/$ in the open market for the second consecutive business day.
Reading: Rupee hits fresh 5-month high at 278.74/$
The currency received support from ongoing smooth talks with the IMF to release the final $1.1 billion tranche under the $3 billion standby arrangement that expires in March-April 2024.
The five-day talks were scheduled to end on Monday with an expected staff-level agreement, meaning the IMF mission is confident Pakistan has met nearly all of the targets set for the latest tranche.
On the other hand, the government has decided to formally approach the IMF for a bigger and bigger loan program of $8 billion in mid-April 2024, when the global lender will hold its annual meetings. Pakistan’s Finance Minister Muhammad Aurangzeb is set to attend the meetings along with his economic team.
Earlier, Pakistan’s foreign exchange reserves, held by the SBP, rose by $17 million to $7.9 billion, according to the central bank’s weekly update. The increase in foreign exchange reserves indicates that the supply of foreign currency is higher than the demand in the banking system. Exporters are constantly selling increased dollar earnings on futures counters.
Published in The Express Tribune, March 19u2024.
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