On May 2, 2023, the US dollar rebounded against the Pakistan Rupee (PKR) and closed at PKR 283.92 in the interbank foreign exchange market.
This was due to pressure on the PKR against the greenback caused by the market reopening after weekly holidays and a public holiday for Labor Day.
READ MORE: PKR makes gain against dollar amid easing political tension
Despite the initiation of dialogue between the ruling party and opposition to resolve election date issues, roadblocks in the International Monetary Fund (IMF) loan program remain a concern for investors.
Political uncertainty arising from conflicts between parliament and the Supreme Court over the Punjab elections, as well as mounting demand for foreign payments, has further pressured the exchange rate.
READ MORE: PKR weakens against dollar at interbank closing on April 27, 2023
While the recent current account surplus has given some relief to the PKR, concerns remain regarding the decline in remittances and depletion of foreign exchange reserves. Positive developments, including IMF assurances, funding commitments from Saudi Arabia and the UAE, and ease of import and corporate payments before Eid holidays, have helped alleviate concerns.
READ MORE: PKR to dollar at interbank closing on April 26, 2023
However, delays and roadblocks in the IMF loan program have led to further uncertainty and volatility in the foreign exchange market, emphasizing the need for swift and effective action to stabilize the currency and address underlying economic challenges.
