Karachi, May 14, 2024 – The Pakistani Rupee exhibited a slight recovery on Tuesday, gaining two paisas to close at PKR 278.18 against the dollar in the interbank foreign exchange market, reversing a downward trend observed a day earlier when it closed at PKR 278.20.
Currency experts attribute this marginal rebound to improved economic sentiments, particularly buoyed by escalated foreign exchange reserves. Recent data released by the State Bank of Pakistan (SBP) revealed a substantial increase in foreign exchange reserves, surging to $14.459 billion as of May 3, 2024. This surge is primarily attributed to a $1.1 billion disbursement by the International Monetary Fund (IMF) under its Stand-By Arrangement (SBA) program, which significantly bolsters Pakistan’s economic stability.
The infusion of IMF funds comes at a critical juncture for Pakistan, which has been diligently implementing multifaceted strategies to stabilize its economy. Notably, there has been a considerable reduction in the trade deficit, as reported by the Pakistan Bureau of Statistics (PBS), shrinking by 17% year-on-year for the first ten months of fiscal year 2024, from $23.54 billion to $19.51 billion. This decline is viewed as instrumental in the nation’s fiscal well-being and forms a cornerstone of its stabilization efforts.
Simultaneously, Pakistan’s export sector has displayed resilience, recording a noteworthy growth of 9.10% to reach $25.28 billion compared to the previous fiscal year’s $23.17 billion. This growth has been propelled by strategic pricing adjustments and successful market expansion initiatives.
An official from the Ministry of Commerce emphasized the significance of these achievements, stating, “Exports play a pivotal role in foreign exchange earnings, employment generation, and industrial growth. Our efforts to enhance export competitiveness are yielding positive results amidst global economic challenges.”
Furthermore, the SBP highlighted the overall improvement in reserves, including a $36 million increment in the week ending April 26, bringing the total to $13.32 billion, providing a crucial buffer against external financial pressures. The SBP’s share of these reserves stood at $8.006 billion.
As Pakistan navigates through economic challenges, the uptick in foreign exchange reserves, coupled with positive trade indicators, offers a ray of hope for sustained economic stability and growth. The slight recovery of the Pakistani Rupee against the dollar underscores the resilience of Pakistan’s economy amid global uncertainties.
