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Category: Money & Banking

Money and banking drive economic activity by facilitating transactions, savings, and investments. Banks manage financial resources, offer credit, and regulate money supply, ensuring stability and growth in Pakistan’s financial sector.

  • Dollar gains 25 paisas to PKR on forex reserves decline

    Dollar gains 25 paisas to PKR on forex reserves decline

    KARACHI: The US dollar gained 25 paisas against the Pakistan Rupee (PKR) on Friday as foreign exchange reserves of the country further declined.

    The exchange rate ended at Rs207.48 to the dollar from previous day’s closing of Rs207.23 in the interbank foreign exchange market.

    The rupee fell a day after making sharp recover of Rs4.70 against the dollar on expectations of inflows from China. However, the fall in foreign exchange reserves again put pressure on the local currency.

    READ MORE: Dollar retreats to Rs207.23 at interbank closing

    The rupee fell to the all-time low at Rs211.93 to the dollar on June 22, 2022.

    The official foreign exchange reserves of State Bank of Pakistan (SBP) have decreased around 32-month low at $8.238 billion by week ended June 17, 2022. The official reserves of the central bank fell by $747 million to $8.238 billion by week ended June 17, 2022 as compared with $8.985 billion by week ended June 10, 2022.

    Previously, the foreign exchange reserves of the SBP were seen on November 01, 2019 when those were at $8.358 billion.

    Considering the current official reserves of the State Bank at $8.238 billion, the import cover is only for 1.21 months.

    READ MORE: Rupee slips to new low at Rs211.93 against dollar

    The central bank attributed the decline in foreign exchange reserves for external debt repayments. However, SBP reserves are expected to increase in coming days on realization of proceeds of China Development Bank (CDB) loan.

    The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021. Since touching the peak the central bank’s foreign exchange witnessed a continuous decline. The official reserves of the SBP fell around $11.91 billion by week ended June 17, 2022 from touching the peak on August 27, 2021.

    The total foreign exchange reserves of Pakistan have declined to around three-year low at $14.21 billion by week ended June 17, 2022. Previously, the foreign exchange reserves of the country were seen at $14.259 billion by week ended July 5, 2019. The country’s foreign exchange reserves have fallen by $733 million to $14.21 billion by week ended June 17, 2022 as compared with $14.943 billion a week ago i.e. June 10, 2022.

    READ MORE: Free-fall in rupee continues; dollar peaks at Rs211.48

    The country’s foreign exchange reserves hit all-time high of $27.228 billion on August 27, 2021. Since then the foreign exchange reserves have declined by $13.018 billion.

    The rupee remained under pressure against the greenback during the current fiscal year. The State Bank of Pakistan (SBP) has taken various measures to support balance of payment and the local currency. However, the measures ended in a failure to help the rupee to recover losses.

    The SBP on May 23, 2022 announced a sharp increase in policy rate by 150 basis points to 13.75 per cent from 12.25 per cent.

    READ MORE: Dollar hits historic high against rupee, ends near Rs210

    Recently the government announced a complete ban on imports to support balance of payment and help the rupee to stabilize. But all these measures appeared in failure as the exchange rate yet again deteriorated today massively.

  • Dollar retreats to Rs207.23 at interbank closing

    Dollar retreats to Rs207.23 at interbank closing

    KARACHI: The US dollar retreated against the Pakistan Rupee (PKR) on Thursday after the country entered in a deal of $2.3 billion, which is likely to be transferred in a day.

    The rupee gained Rs4.70 to end at Rs207.23 to the dollar from previous day’s closing at Rs211.93 in interbank foreign exchange market.

    The rupee made the latest record low of Rs211.93 on June 22, 2022.

    READ MORE: Rupee slips to new low at Rs211.93 against dollar

    Currency experts said that Pakistan would get an amount of $2.3 billion as the country and Chinese consortium banks finalized an agreement in this regard.

    Besides, the market also responded positively to expected deal between Pakistan and the IMF as the government authorities had agreed to many tough conditions, including revision of the federal budget targets.

    They said that the foreign exchange reserves had declined to critically low, which created panic in the market. Besides, high oil prices and rise in commodity prices globally also pushed dollar demand for import payments.

    READ MORE: Free-fall in rupee continues; dollar peaks at Rs211.48

    According to data released by the State Bank of Pakistan (SBP) a day earlier, the official reserves of the central bank had declined to provide about one month import cover.

    The official foreign exchange reserves of the State Bank of Pakistan (SBP) fell by $241 million to $8.985 billion by week ended June 10, 2022 as compared with $9.226 billion a week ago i.e. June 03, 2022.

    The present level of the SBP’s reserves showed that the central bank has import cover for around only one months.

    Pakistan’s import bill for the month of May 2022 recorded at $6.777 billion, according to Pakistan Bureau of Statistics (PBS).

    The latest foreign exchange reserves of the SBP showed it fell around 2½ years low. Previously, the foreign exchange reserves held by the central bank were seen at $9.233 billion on December 6, 2019.

    READ MORE: Dollar hits historic high against rupee, ends near Rs210

    The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021.

    Since touching the peak the central bank’s foreign exchange witnessed a continuous decline. The official reserves of the SBP fell around $11.16 billion by week ended June 10, 2022 from touching the peak on August 27, 2021.

    The country is facing serious balance of payment crisis during the past many months. The foreign exchange reserves of the central bank have seen a constant decline.

    READ MORE: Rupee collapses to fresh low against dollar to Rs208.75

    The rupee remained under pressure against the greenback during the current fiscal year. The State Bank of Pakistan (SBP) has taken various measures to support balance of payment and the local currency. However, the measures ended in a failure to help the rupee to recover losses.

    The SBP on May 23, 2022 announced a sharp increase in policy rate by 150 basis points to 13.75 per cent from 12.25 per cent.

    Recently the government announced a complete ban on imports to support balance of payment and help the rupee to stabilize. But all these measures appeared in failure as the exchange rate yet again deteriorated today massively.

  • SBP allows bankers to work from home for fuel, energy conservation

    SBP allows bankers to work from home for fuel, energy conservation

    KARACHI: The State Bank of Pakistan (SBP) has allowed banks to grant their employees to work from home in order to conserve energy including fuel and energy.

    The SBP on Wednesday issue a circular stating that the Federal and Provincial Governments are taking a number of actions to address the prevailing energy situation in the country.

    READ MORE: Total bank accounts in Pakistan grow to 66.13 million

    In a similar bid, the SBP has taken a number of measures to conserve energy. It is expected that the banking industry will also play its role for energy and fuel conservation.

    The SBP said that the banks may formulate a policy on “Work From Home (WFH)” whereby banks’ offices (other than branches) can observe, one/two days in every week, as WFH to achieve the intended objectives.

    READ MORE: Internet banking posts 20% growth in 3Q: State Bank

    The banks may close all of its premises including branches at 7:00 pm or earlier and switch-off their electric supply except for any emergency use, call centers, monitoring of Alternative Delivery Channels (ADCs), back-ups and maintaining necessary electrical/ IT equipment. Moreover, the air-conditioners at ATMs vestibules may be used economically.

    The electrically illuminated sign-boards of branches and other offices shall remain switched-off, at all times.

    READ MORE: SBP renews status of credit rating agencies

    The banks are encouraged to hold their meetings (intra/inter-city etc.) virtually and also curtail their local as well as international travelling expenses.

    The banks shall encourage their staff to pool their transportation for commuting to and from their respective offices and take any other measure(s) for reducing the commutation time of the bank staff.

    The banks may adopt the use of alternate and cost effective sources of energy such as deployment of solar technologies and encourage use of energy efficient equipment, fixtures and appliances in their premises.

    READ MORE: High tax may erode banks’ earnings up to 20%

    The banks may take any other steps/ actions to curtail the consumption of electricity and fuel in their respective offices including branches.

    The banks shall enhance awareness of their employees as well as customers about energy conservation initiatives and encourage them to take part in this energy conservation drive. 

    In order to achieve the intended objectives, the banks are advised to ensure adequate oversight and monitoring mechanism of energy conservation drive.

    READ MORE: Pakistan slaps 45% corporate tax on banks

    In view of foregoing, banks are advised to take appropriate measures and share their energy conservation plan with SBP latest by June 24, 2022 (Friday). Such measures should be effective latest from July 01, 2022.

  • HBL ordered to compensate bank fraud victim

    HBL ordered to compensate bank fraud victim

    ISLAMABAD: President of Pakistan, Dr. Arif Ali Alvi, on Wednesday ordered Habib Bank Limited (HBL) to immediate compensate a victim of bank fraud.

    President Dr Arif Alvi reprimanded HBL for unnecessarily dragging the matter of reimbursement of a trivial amount of Rs. 39,000 to the victim of bank fraud.

    READ MORE: SBP takes measures for prevention of digital bank fraud

    He directed the bank to reimburse the defrauded amount, along with the payment of transportation charges, within fifteen days to the victim and termed the action of the HBL an act of malpractice and maladministration.

    The President reprimanded the HBL for preferring representation before the President against the order passed by the Banking Ombudsman in favor of the victim of the bank fraud involving a meager amount.

    READ MORE: SBP directs banks to report digital fraud cases

    The President observed that the transfer of money from one account to another through cheating was a common incident of fraudulent activity but despite the knowledge of the account where the money landed and was then withdrawn no action was taken against the beneficiary of the transaction.

    The President emphasized that the bank was liable to make good the loss of their customers and advised the bank management to look into the issue and take remedial measures to safeguard the interest of its customers, especially the small depositors and account holders.

    READ MORE: Habib Bank, Meezan Bank directed to pay fraud victims

    The President directed the State Bank of Pakistan, being a regulatory body, to take earnest action against both the Banks and bank branches by adopting regulatory and punitive action to redress the fraudulent activities which result from noncompliance with Rules and Regulations issued by the State Bank of Pakistan.

    According to the details, an unknown person tricked Nazeer Ahmad Bhutta to provide the last digits of his ATM card and later deprived him of his deposit.

    READ MORE: President Alvi rejects MCB Bank’s appeal in fraud case

    The victim preferred an appeal before the Banking Ombudsman who decided the case in favour of the victim. However, HBL, instead of implementing the decision, preferred representation to the President.

    The President upheld the decision of the Banking Ombudsman and directed the Bank to reimburse the defrauded money to the complainant.

  • Rupee slips to new low at Rs211.93 against dollar

    Rupee slips to new low at Rs211.93 against dollar

    KARACHI: The Pakistan Rupee (PKR) slipped to new historic low at Rs211.93 against dollar on Wednesday in interbank foreign exchange market.

    The rupee fell by 45 paisas to end at Rs211.93 to the dollar from previous day’s closing of Rs211.48 in the interbank foreign exchange market.

    READ MORE: Free-fall in rupee continues; dollar peaks at Rs211.48

    Currency experts said that the local unit was under pressure due to fiscal weakness and falling foreign exchange reserves.

    They said that the foreign exchange reserves had declined to critically low, which created panic in the market. Besides, high oil prices and rise in commodity prices globally also pushed dollar demand for import payments.

    According to data released by the State Bank of Pakistan (SBP) a day earlier, the official reserves of the central bank had declined to provide about one month import cover.

    READ MORE: Dollar hits historic high against rupee, ends near Rs210

    The official foreign exchange reserves of the State Bank of Pakistan (SBP) fell by $241 million to $8.985 billion by week ended June 10, 2022 as compared with $9.226 billion a week ago i.e. June 03, 2022.

    The present level of the SBP’s reserves showed that the central bank has import cover for around only one months.

    Pakistan’s import bill for the month of May 2022 recorded at $6.777 billion, according to Pakistan Bureau of Statistics (PBS).

    READ MORE: Rupee collapses to fresh low against dollar to Rs208.75

    The latest foreign exchange reserves of the SBP showed it fell around 2½ years low. Previously, the foreign exchange reserves held by the central bank were seen at $9.233 billion on December 6, 2019.

    The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021.

    Since touching the peak the central bank’s foreign exchange witnessed a continuous decline. The official reserves of the SBP fell around $11.16 billion by week ended June 10, 2022 from touching the peak on August 27, 2021.

    The country is facing serious balance of payment crisis during the past many months. The foreign exchange reserves of the central bank have seen a constant decline.

    The country was expecting inflows from various sources but so far those were not materialized so far. The country also making all efforts to resume IMF program to obtain about $ 1 billion next tranche under Extended Fund Facility (EFF).

    READ MORE: Pakistan’s central bank reserves shrink to one month import cover

    It is pertinent to mention that the government had twice increased the prices of petroleum products since May 26, 2022 in order to satisfy the International Monetary Fund (IMF) for the release of next tranche of about $1 billion. Another increase was seen on June 15, 2022.

    The government on May 26, 2022 decided partially withdraw the subsidy to get the next tranche of the IMF, the rupee sharply made gains against the dollar. The local unit made a recovery of Rs4.42 against the dollar during the past five sessions.

    The rupee remained under pressure against the greenback during the current fiscal year. The State Bank of Pakistan (SBP) has taken various measures to support balance of payment and the local currency. However, the measures ended in a failure to help the rupee to recover losses.

    The SBP on May 23, 2022 announced a sharp increase in policy rate by 150 basis points to 13.75 per cent from 12.25 per cent.

    Recently the government announced a complete ban on imports to support balance of payment and help the rupee to stabilize. But all these measures appeared in failure as the exchange rate yet again deteriorated today massively.

  • Faysal Bank launches hotel booking services

    Faysal Bank launches hotel booking services

    KARACHI: Faysal Bank Limited, in partnership with Pakistan’s largest hospitality technology company – Ascendant, has launched a hotel booking platform for its customers that enables them to conveniently book hotels online through their website: www.faysalbank.com

    The website offers 1600+ hotels and guest houses in 50 cities across Pakistan. This initiative by Faysal Islami, a leading Islamic Bank of Pakistan and winner of Best Islamic bank for Transformation and innovation at the Global Islamic Finance Awards (GIFA), marks an integral step towards the promotion of domestic tourism. In addition, the bank also plans to introduce international hotels to this service to facilitate customers who wish to travel abroad.

    READ MORE: PITB, Faysal Bank sign MoU to facilitate freelancers

    Speaking on the occasion of the launch ceremony, Mr. Aneeq Malik, Group Head Consumer Finance and Payment Services Faysal Bank said: “We always aim to bring the best banking services to our customers at their fingertips. Faysal Bank has always believed in innovation and digitalization of services for the ease of customers. With Ascendant by our side, our customers can now not only check the rates of any hotel rooms across Pakistan but also book the hotel and pay online using their bank accounts, debit or credit cards through our website.”

    CEO of Ascendant, Mr. Andre Privateer said: As the only hospitality tech provider able to offer real time rates and availability at more than 80% of Pakistan’s hotels, we serve the tourism sector by making the online booking experience better for the consumer. Through this strategic alliance with Faysal Bank, individuals can now book and pay with ease through this platform on Faysal Bank’s website and soon to be launched on their mobile app as well.”

    READ MORE: FBR establishes IT center against cyber security attacks

    Head of Unsecured Business and Payment services Faysal Bank, Mr. Feroz Khan further added: “This business alliance is a testimony of our commitment to our customers. We at Faysal Bank, continue to strive to build loyalty by offering innovative products and benefits for our valued customers. This collaboration aims to make travel and tourism across all corners of Pakistan more accessible for our customers.”

    Faysal Bank is one of the most progressive Islamic banks in Pakistan and has concentrated on growth through improving service quality, investment in technology, people and utilizing its extensive growing Islamic branch network.

    Ascendant is a specialized hospitality technology company revolutionizing the tourism landscape in Pakistan by unlocking exceptional value for travel suppliers and customers.

  • Free-fall in rupee continues; dollar peaks at Rs211.48

    Free-fall in rupee continues; dollar peaks at Rs211.48

    KARACHI: The free-fall in Pakistan Rupee (PKR) continued against the US dollar on Tuesday as the exchange rate ended at Rs211.48 to the dollar at closing of interbank foreign exchange market.

    The rupee fell by Rs1.52 to Rs211.48 the dollar from previous day’s closing of Rs209.96 in the interbank foreign exchange market.

    READ MORE: Dollar hits historic high against rupee, ends near Rs210

    The rupee is continuous making fresh lows for the last many days owing to serious weaknesses in fiscal condition including massive fall in foreign exchange reserves.

    Currency experts said that the foreign exchange reserves had declined to critically low, which created panic in the market. Besides, high oil prices and rise in commodity prices globally also pushed dollar demand for import payments.

    According to data released by the State Bank of Pakistan (SBP) a day earlier, the official reserves of the central bank had declined to provide about one month import cover.

    READ MORE: Rupee collapses to fresh low against dollar to Rs208.75

    The official foreign exchange reserves of the State Bank of Pakistan (SBP) fell by $241 million to $8.985 billion by week ended June 10, 2022 as compared with $9.226 billion a week ago i.e. June 03, 2022.

    The present level of the SBP’s reserves showed that the central bank has import cover for around only one months.

    Pakistan’s import bill for the month of May 2022 recorded at $6.777 billion, according to Pakistan Bureau of Statistics (PBS).

    The latest foreign exchange reserves of the SBP showed it fell around 2½ years low. Previously, the foreign exchange reserves held by the central bank were seen at $9.233 billion on December 6, 2019.

    The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021.

    READ MORE: Pakistan’s central bank reserves shrink to one month import cover

    Since touching the peak the central bank’s foreign exchange witnessed a continuous decline. The official reserves of the SBP fell around $11.16 billion by week ended June 10, 2022 from touching the peak on August 27, 2021.

    The country is facing serious balance of payment crisis during the past many months. The foreign exchange reserves of the central bank have seen a constant decline.

    The country was expecting inflows from various sources but so far those were not materialized so far. The country also making all efforts to resume IMF program to obtain about $ 1 billion next tranche under Extended Fund Facility (EFF).

    It is pertinent to mention that the government had twice increased the prices of petroleum products since May 26, 2022 in order to satisfy the International Monetary Fund (IMF) for the release of next tranche of about $1 billion. Another increase was seen on June 15, 2022.

    The government on May 26, 2022 decided partially withdraw the subsidy to get the next tranche of the IMF, the rupee sharply made gains against the dollar. The local unit made a recovery of Rs4.42 against the dollar during the past five sessions.

    READ MORE: Free-fall in rupee continues, dollar touches new high at Rs206.46

    The rupee remained under pressure against the greenback during the current fiscal year. The State Bank of Pakistan (SBP) has taken various measures to support balance of payment and the local currency. However, the measures ended in a failure to help the rupee to recover losses.

    The SBP on May 23, 2022 announced a sharp increase in policy rate by 150 basis points to 13.75 per cent from 12.25 per cent.

    Recently the government announced a complete ban on imports to support balance of payment and help the rupee to stabilize. But all these measures appeared in failure as the exchange rate yet again deteriorated today massively.

  • Dollar reaches Rs212 at midday interbank trading

    Dollar reaches Rs212 at midday interbank trading

    KARACHI: The US Dollar reached historic high at Rs212 against Pakistani Rupee (PKR) in midday trading at interbank foreign exchange market on Tuesday.

    The US dollar is being traded at Rs212 after gaining Rs2.04 from last day’s closing of Rs209.96 in the interbank foreign exchange market.

    READ MORE: Dollar climbs up to Rs210 in midday interbank trading

    Currency experts said that the foreign exchange reserves had declined to critically low, which created panic in the market. Besides, high oil prices and rise in commodity prices globally also pushed dollar demand for import payments.

    According to data released by the State Bank of Pakistan (SBP) a day earlier, the official reserves of the central bank had declined to provide about one month import cover.

    The official foreign exchange reserves of the State Bank of Pakistan (SBP) fell by $241 million to $8.985 billion by week ended June 10, 2022 as compared with $9.226 billion a week ago i.e. June 03, 2022.

    The present level of the SBP’s reserves showed that the central bank has import cover for around only one months.

    READ MORE: Dollar hits historic high against rupee, ends near Rs210

    Pakistan’s import bill for the month of May 2022 recorded at $6.777 billion, according to Pakistan Bureau of Statistics (PBS).

    The latest foreign exchange reserves of the SBP showed it fell around 2½ years low. Previously, the foreign exchange reserves held by the central bank were seen at $9.233 billion on December 6, 2019.

    The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021.

    Since touching the peak the central bank’s foreign exchange witnessed a continuous decline. The official reserves of the SBP fell around $11.16 billion by week ended June 10, 2022 from touching the peak on August 27, 2021.

    READ MORE: Pakistan’s central bank reserves shrink to one month import cover

    The country is facing serious balance of payment crisis during the past many months. The foreign exchange reserves of the central bank have seen a constant decline.

    The country was expecting inflows from various sources but so far those were not materialized so far. The country also making all efforts to resume IMF program to obtain about $ 1 billion next tranche under Extended Fund Facility (EFF).

    It is pertinent to mention that the government had twice increased the prices of petroleum products since May 26, 2022 in order to satisfy the International Monetary Fund (IMF) for the release of next tranche of about $1 billion. Another increase was seen on June 15, 2022.

    The government on May 26, 2022 decided partially withdraw the subsidy to get the next tranche of the IMF, the rupee sharply made gains against the dollar. The local unit made a recovery of Rs4.42 against the dollar during the past five sessions.

    The rupee remained under pressure against the greenback during the current fiscal year. The State Bank of Pakistan (SBP) has taken various measures to support balance of payment and the local currency. However, the measures ended in a failure to help the rupee to recover losses.

    The SBP on May 23, 2022 announced a sharp increase in policy rate by 150 basis points to 13.75 per cent from 12.25 per cent.

    Recently the government announced a complete ban on imports to support balance of payment and help the rupee to stabilize. But all these measures appeared in failure as the exchange rate yet again deteriorated today massively.

    READ MORE: Free-fall in rupee continues, dollar touches new high at Rs206.46

  • Last date June 30, 2022 to exchange prize bonds

    Last date June 30, 2022 to exchange prize bonds

    KARACHI: The bearer prize bonds of various denominations will not be exchangeable or convertible after June 30, 2022, which is the last date set by the government.

    The federal government has extended the last date for converting or exchanging the bearer prize bonds up to June 30, 2022.

    The State Bank of Pakistan (SBP) issued a circular on March 30, 2022 to extend the date up to June 30, 2022 for exchanging or converting the bearer prize bonds including denominations of Rs40,000/- Rs25,000/-, Rs15,000/- and Rs7,500.

    Earlier, the last date for exchanging the bearer prize bonds was March 31, 2022.

    READ MORE: SBP directs banks to accept bearer prize bonds

    The SBP instructed the banks to accept requests for encashment / conversion / redemption of cited denominations from general public till June 30, 2022.

    “Further, the banks shall submit branch / region wise consolidated data of cited denomination national prize bonds held by them on last date i.e. June 30, 2022 latest by July 04, 2022, as per the instructions stipulated in aforementioned CMD Circulars.

    READ MORE: Prize bond (bearer) holders given 3 months to document

    The finance ministry launched the withdrawal of the unregistered prize bonds in a phased manner. The federal government on June 24, 2019, announced to discontinue the circulation of Rs40,000 denomination national prize bonds. Similarly, on December 10, 2020, the government announced to discontinue the circulation of Rs25,000 denomination prize bonds. In April 2021, the finance ministry announced that national prize bonds of denominations Rs7,500 and Rs15,000 shall not be sold.

    Since June 2019 the government repeatedly extended the date for exchanging the bearer bonds. Previously, the last date for exchanging the unregistered bonds was December 31, 2021.

    READ MORE: History of Prize Bonds in Pakistan

    The government is aiming to document the bearer bonds so the exchanging the unregistered bond with cash has been prohibited. The ministry of finance issued various procedure to convert the bond without exchanging with the cash.

    The bonds can be converted to premium prize bonds (registered) of denomination of Rs25,000 and Rs40,000 (subject to the adjustment of differential amount) through 16 field offices of State Bank of Pakistan (SBP) Banking Services Corporation (BSC), and branches of six commercial banks i.e. National Bank of Pakistan, Habib Bank Limited, United Bank Limited, MCB Bank Limited, Allied Bank Limited, and Bank Alfalah Limited.

    READ MORE: Income tax on prize bonds, lottery winning

    The bonds can be replaced with Special Saving Certificates/Defence Saving Certificates through the 16 field offices of SBP Banking Services Corporation, authorized commercial banks, and the National Savings Center.

    The bonds will only be encashed by transferring the proceeds to the bonds holder’s bank account through the 16 field offices of SBP BSC as well as the authorized commercial bank branches and to the Saving Accounts at National Savings Centers.

  • Dollar hits historic high against rupee, ends near Rs210

    Dollar hits historic high against rupee, ends near Rs210

    KARACHI: The US dollar closed near Rs210, a new record high against the Pakistan Rupee (PKR) on Monday amid falling foreign exchange reserves and demand for import payments.

    The exchange rate recorded a decline of Rs1.21 in rupee value to end at Rs209.96 to the dollar from last Friday’s closing of Rs208.75 in the interbank foreign exchange market.

    READ MORE: Rupee collapses to fresh low against dollar to Rs208.75

    According to data released by the State Bank of Pakistan (SBP) a day earlier, the official reserves of the central bank had declined to provide about one month import cover.

    The official foreign exchange reserves of the State Bank of Pakistan (SBP) fell by $241 million to $8.985 billion by week ended June 10, 2022 as compared with $9.226 billion a week ago i.e. June 03, 2022.

    The present level of the SBP’s reserves showed that the central bank has import cover for around only one months.

    Pakistan’s import bill for the month of May 2022 recorded at $6.777 billion, according to Pakistan Bureau of Statistics (PBS).

    The latest foreign exchange reserves of the SBP showed it fell around 2½ years low. Previously, the foreign exchange reserves held by the central bank were seen at $9.233 billion on December 6, 2019.

    The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021.

    READ MORE: Pakistan’s central bank reserves shrink to one month import cover

    Since touching the peak the central bank’s foreign exchange witnessed a continuous decline. The official reserves of the SBP fell around $11.16 billion by week ended June 10, 2022 from touching the peak on August 27, 2021.

    The country is facing serious balance of payment crisis during the past many months. The foreign exchange reserves of the central bank have seen a constant decline.

    The country was expecting inflows from various sources but so far those were not materialized so far. The country also making all efforts to resume IMF program to obtain about $ 1 billion next tranche under Extended Fund Facility (EFF).

    It is pertinent to mention that the government had twice increased the prices of petroleum products since May 26, 2022 in order to satisfy the International Monetary Fund (IMF) for the release of next tranche of about $1 billion. Another increase was seen on June 15, 2022.

    The government on May 26, 2022 decided partially withdraw the subsidy to get the next tranche of the IMF, the rupee sharply made gains against the dollar. The local unit made a recovery of Rs4.42 against the dollar during the past five sessions.

    READ MORE: Free-fall in rupee continues, dollar touches new high at Rs206.46

    The rupee remained under pressure against the greenback during the current fiscal year. The State Bank of Pakistan (SBP) has taken various measures to support balance of payment and the local currency. However, the measures ended in a failure to help the rupee to recover losses.

    The SBP on May 23, 2022 announced a sharp increase in policy rate by 150 basis points to 13.75 per cent from 12.25 per cent.

    Recently the government announced a complete ban on imports to support balance of payment and help the rupee to stabilize. But all these measures appeared in failure as the exchange rate yet again deteriorated today massively.

    READ MORE: Rupee’s erosion continues as dollar closes at Rs205.16