Karachi, July 27, 2023 – The Pakistani Rupee (PKR) experienced a slight uptick against the US Dollar in the interbank foreign exchange market today, due to financial assistance from China.
The local currency saw a marginal increase of 59 paisas against US Dollar, closing at PKR 286.45, as compared to the previous day’s closing rate of PKR 287.04.
Experts in the currency market attribute this small increase to the postponement of Chinese debt and commitments from Chinese banks, which arrived at a crucial time given the recent volatility in the currency exchange rate.
READ MORE: Chinese Assistance Helps PKR Resist Dollar After 8-Day Losing Streak
This volatility was partly triggered by the International Monetary Fund’s (IMF) approval of a $3 billion Stand By Agreement (SBA) for Pakistan. The country has already received the first tranche of $1.2 billion from the IMF, leading to a noteworthy rise in foreign exchange reserves, now totaling $14.07 billion.
Despite the growth in foreign exchange reserves, the foreign exchange market remains skeptical, and the rupee has faced significant devaluation over the past eight sessions since July 14. Some financial experts speculate that this decline might be influenced by the IMF’s insistence on adopting a more flexible exchange rate regime, causing fluctuations in the currency’s value.
While economic authorities in Pakistan are carefully monitoring the situation and planning necessary steps to stabilize the currency and promote economic growth, it is uncertain how long the rupee’s losing streak will persist.
The government’s response and actions to address the underlying economic factors impacting the currency’s value will be critical in navigating through this period of financial turbulence.
As the nation grapples with these challenges, market participants and citizens are closely observing the currency’s performance and the government’s measures to make informed financial decisions. The situation calls for vigilant monitoring and proactive measures to mitigate the impact on the country’s economy and ensure stability in the foreign exchange market.
READ MORE: Rupee in Freefall: Pakistani Currency’s 7-Day Losing Streak Against Dollar Continues
