Karachi, July 21, 2023 – The Pakistani Rupee continued its losing streak for the sixth consecutive day against the US dollar, reaching PKR 286.81 on Friday. The currency experienced a significant depreciation, losing PKR 10.35 from its value since July 13, 2023, when it was trading at PKR 276.46.
READ MORE: PKR Continues to Slide Against USD, Closes at PKR 285.15 in Interbank
One of the contributing factors to the recent volatility in the currency exchange rate is the approval of a $3 billion Stand By Agreement (SBA) for Pakistan by the executive board of the International Monetary Fund (IMF). In line with this approval, Pakistan has received the first tranche of $1.2 billion out of the total amount committed by the IMF.
Interestingly, despite a substantial rise in Pakistan’s foreign exchange reserves, the foreign exchange market seemed to ignore this positive development. The country’s foreign exchange reserves experienced a remarkable increase, reaching $14.07 billion. This growth was mainly attributed to significant inflows from the IMF and other friendly countries.
READ MORE: Pakistani Rupee Continues to Depreciate Against Dollar; Ends at PKR 283.80
According to the State Bank of Pakistan (SBP), the country’s foreign exchange reserves surged by an impressive $4.227 billion, reaching $14.07 billion by the end of the week on July 14, 2023. This sharp contrast is noteworthy, considering that the reserves were recorded at $9.838 billion just a week earlier on July 7, 2023.
Experts in the financial sector believe that the decline in the value of the Pakistani Rupee might be influenced by the IMF’s demands for the country to allow market forces to determine the exchange rate. The push for a more flexible exchange rate regime may be causing fluctuations in the currency’s value.
READ MORE: Rupee Witnesses Significant Devaluation Against US Dollar, Plummeting to PKR 283.04
Additionally, the surge in dollar demand resulting from the latest demands for import payments could also be putting pressure on the exchange rate.
The economic authorities in Pakistan will closely monitor the situation and take necessary steps to stabilize the currency and promote economic growth in the country amidst these developments.
READ MORE: Rupee Drops PKR 1.67 Against Dollar Amid Surging Import Payment Demand
