KARACHI – The Pakistani Rupee (PKR) showed signs of stability as it gained 11 paisas to close at PKR 284.97 against the US dollar on Monday in the interbank foreign exchange market.
This improvement comes after the currency ended at PKR 285.08 at the close of the previous week.
READ MORE: Pakistani Rupee surges with historic single-day recovery of PKR 13.85 against dollar
Currency experts attribute the rupee’s stability to the easing of political tensions and a positive response from the International Monetary Fund (IMF). Last week, the local currency experienced high volatility, reaching its lowest level against the dollar at PR 298.93 on May 11, 2023. However, it rebounded strongly the following day.
The depreciation of the rupee last week was primarily influenced by the arrest of former Prime Minister Imran Khan. Khan’s arrest, which took place within the premises of the Islamabad High Court on corruption charges, led to nationwide protests and drew criticism from political parties. This political turmoil had a detrimental impact on investor confidence and the value of the rupee.
READ MORE: PKR stages remarkable recovery, surging to 285 against dollar in early trading
The rupee’s appreciation received a boost from a recent statement by the IMF, expressing its intention to continue the loan program with Pakistan. This announcement further contributed to the positive sentiment surrounding the Pakistani currency.
While currency experts cautiously monitor these developments, they emphasize the need for decisive measures by the government to stabilize the currency and restore investor confidence. Such measures may involve implementing effective economic policies, addressing corruption concerns, and creating a transparent and predictable investment environment.
READ MORE: Rupee witnesses bloodbath; hits record low of PKR 298.93 against dollar
Constructive dialogue with the IMF is considered crucial for the Pakistani government to secure the much-needed loan program. Demonstrating a commitment to fiscal discipline, implementing structural reforms, and ensuring good governance are vital steps in alleviating concerns about the economy and bolstering the rupee’s value in the international market.
READ MORE: INTERBANK CLOSING: Rupee hits historic low at PKR 290.22 to dollar
It is important to note that currency fluctuations are not unique to Pakistan, as many emerging economies have faced similar challenges in recent years. The government’s response and its ability to address the underlying causes of the rupee’s depreciation will play a crucial role in achieving financial stability and restoring confidence in the Pakistani Rupee.
