ISLAMABAD: After four days of continuous depreciation followed by a one-day appreciation in the previous week, the Pakistani currency registered a marginal decline while going down by Rs0.02 paisa (0.01%) against the American dollar in the inter-bank market on Monday.
At close, the local currency settled at 278.33, against the last-day closure of Rs278.31 last day, as reported by the State Bank of Pakistan (SBP).
According to media reports quoting sources, the International Monetary Fund (IMF) has not yet included Pakistan on the agenda of its executive board meetings scheduled from April 29 to May 1. However, Pakistan is hoping the possible approval from the executive board would pave the way for the country to get the remaining funds of around $1.1 billion as the final tranche of the $3-billion SBA signed last year in June 2023.
Pakistani Rupee Against US Dollar
The local currency oscillated both ways against the greenback during the last couple of months with recent continued appreciation except the last few days. From September, till the middle of October 2023, the local currency witnessed improvement for a record 28 consecutive sessions against the American dollar, followed by a continuous decline for the 17th consecutive session from October till the middle of November 2023.
However at the end of December 2023, and then in January 2024, the local currency mostly enjoyed appreciation against the American dollar, thanks to the inflow from the IMF (International Monetary Fund) in the form of Rs700m followed by a $2b roll over from the UAE on January 20, 2024. In addition, on 29th February, China also rolled over $2b to Pakistan which was due in March 2024. As a result, the Pakistani currency appreciated by over Rs 7 in the interbank during the last five to six weeks.
In another major development On 20th March (Wednesday) Pakistan and the IMF reached a staff-level agreement over the final review of the $3 billion Standby-By Agreement, adding some relief for boosting the local currency and the country’s economy. However the nation must be ready for further hikes in prices and inflation in the country as the new IMF agreement is likely to be conditioned with further taxation.
In addition, Pakistan’s Finance Minister’s recent engagement in Washington as part of the negotiation for a new multi-billion-dollar programme with the International Monetary Fund (IMF) would further clarify the flow of the local currency in near future.
