KARACHI
Pakistani rupee strengthened by 25 paisas (+0.14 percent) against the US dollar on Friday. The State Bank of Pakistan said that the dollar opened at Rs176.92 in the interbank market and closed at Rs176.67. The rupee witnessed a range of 75 paisas during the session, showing the intraday high bid of 177.20 and low offer of 176.45. Within the open market, the rupee was traded at 177.70/178.70 per dollar.
Overall Pakistan rupee shed 16 paisas against the US dollar during this week and calendar year 2022. Despite State Bank of Pakistan’s intervention and the general bias for a strong rupee, the local unit has depreciated by Rs19.24 during the ongoing fiscal year 2021-22.
The local currency weakened by 10.44 percent (Rs16.68) against the dollar during the calendar year 2021.
According to experts, the government’s steps to ensure revival of the International Monetary Fund’s (IMF) Extended Fund Facility (EFF) is supporting the local currency against the greenback. They were of the view that the US dollar may face a further depreciation in the coming days if all goes well with regards to the IMF programme revival.
They said the greenback is overvalued against the local currency. They said that commodity prices in the international market are likely to decline in the coming months, which will cut Pakistan’s import bill and ease off the pressure on the rupee. They said that rising cases of Covid-19 across the world may compel governments to impose lockdown, giving some room to Pakistan to increase its exports and decrease imports. This may benefit the rupee if macroeconomic stability in the country remains intact.
Meanwhile, the SBP on Wednesday last made it mandatory for exporters to bring export proceeds within 120 days of the shipment, with an objective to improve the timely inflow of foreign exchange from exports proceeds in the market. The central bank said that it has amended the foreign exchange regulations requiring exporters to bring export proceeds within a maximum period of 120 days from the date of shipment. Earlier the exporters were required to bring their export proceeds within a maximum period of 180 days. This move also brings Pakistan’s regulations closer to international best practices. The newly introduced measure is expected to positively impact foreign exchange inflows in the market.
