KARACHI: The Pakistani currency gained Rs5.79 in early morning interbank trade as the local unit continued its winning streak against the dollar for the fifth consecutive day on Thursday.
The greenback was trading at Rs223.
The rupee closed at 228.80 on Wednesday after recording its highest single-day gain against the foreign currency. The dollar had slumped 4.19% against the rupee, the highest since November 2, 1998, when the greenback fell by Rs5.10.
The local unit is gaining ground on the back of higher inflows from exporters and decreased import payments, with hopes that the cash-strapped country was getting closer to securing a bailout from the International Monetary Fund (IMF) boosting sentiment.
The latest trade numbers showing a decline in import numbers also helped in appreciation of the rupee.
Speaking to Geo News today, Exchange Companies Association of Pakistan (ECAP) Chairman Malik Bostan said the current government’s promises would take time to complete earlier, but this time around, just a few days after Finance Minister Miftah Ismail mentioned that Pakistan’s import bill will reduce, it actually fell by $2 billion.
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.
Apart from this, Chief of Staff Army (COAS) General Qamar Javed Bajwa recently spoke to US Deputy Secretary of State Wendy Sherman to help expedite the IMF’s loan programme revival.
Bostan said that just following this, the money lender issued a statement that Pakistan has fulfilled all the prerequisites for the combined seventh and eighth reviews of the Extended Fund Facility — showing that the army chief’s call played its role.
IMF’s Resident Representative for Pakistan Esther Perez Ruiz said in a statement Tuesday that a board meeting is tentatively scheduled for late August once adequate financing assurances are confirmed.
In case the IMF releases the $1.2 billion later in August, Bostan said the dollar could fall to 190-180 against the Pakistan rupee and will continue to break 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.
The forex trader added that earlier 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.