KARACHI: The US dollar slipped to Pakistan Rupee (PKR) 218.75 at the closing of interbank foreign exchange market on Wednesday.
The exchange rate witnessed an appreciation of Rs1.37 to end at Rs218.75 to the dollar from previous day’s closing of Rs220.12 in the interbank foreign exchange market.
READ MORE: Dollar falls to PKR 220.12 at interbank closing on August 30, 2022
Currency experts said that the market was remained optimistic due to resumption of bailout package by the International Monetary Fund (IMF).
On August 29, 2022, the executive board of the IMF completed its Seventh and Eighth review for Pakistan under the Extended Fund Facility (EFF) which is likely to lead to the release of $1.1 billion tranche. This will take total disbursement by IMF under the EFF program to $3.9 billion to Pakistan and will help support foreign exchange reserves of the country.
The rupee fell to the historic low of Rs239.94 against the dollar on July 28, 2022.
READ MORE: Dollar strengthens to PKR 221.92 amid political uncertainty
The currency market witnessed a non-stop depreciation in rupee value since the government lifted the ban on import of luxury and non-essential items. Besides, the prices of international oil are also seeing a rising trend.
The government on August 20, 2022 withdrew the ban on import of luxury and non-essential items. The government on May 19, 2022 imposed this ban in the wake of massive depreciation in rupee value and significant depletion of foreign exchange reserves.
The rupee witnessed a continuous decline against the dollar since the government lifted the ban. The local currency depreciated continuously during the week (August 22 – August 26) and fell Rs6.01 or 2.8 per cent during the period.
The currency experts said that the vertical decline in foreign exchange reserves also put pressure on rupee value.
READ MORE: Dollar surges to PKR 220.66 ahead IMF board meeting
Pakistan’s foreign exchange reserves fell by $91 million to $13.522 billion by the week ended August 19, 2022. The foreign exchange reserves of the country were at $13.613 billion a week ago i.e. August 12, 2022.
The country’s foreign exchange reserves hit an all-time high of $27.228 billion on August 27, 2021. Since then the foreign exchange reserves have declined by $13.703 billion.
READ MORE: Pakistani Rupee falls for 4th day; dollar climbs up to Rs219.14
The official foreign exchange reserves of the State Bank witnessed a decline of $87 million to $7.81 billion by the week ended August 19, 2022 as against $7.897 billion a week ago.
The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by the week ended August 27, 2021. Since then the official reserves of the SBP declined by $12.336 billion.
