ISLAMABAD: After a marginal appreciation for the last three days, the Pakistani rupee registered a slight decline by 10 paisa (0.04%) against the American dollar in the inter-bank market on Thursday.
At close, the local currency settled at Rs278.20 compared to the last day close of Rs278.10, according to the State Bank of Pakistan (SBP).
Meanwhile, as a major development, the Petroleum Division proposed a six-month extension in the signing of the Pakistan Oil Refining Policy for the upgradation of existing/Brownfield refineries as some of the refineries were still not ready to sign the policy.
In addition, Prime Minister Shahbaz Sharif had directed the Petroleum Division to arrange the signing ceremony in his presence, but the division has yet to confirm the date for the signing ceremony.
Meanwhile, the American dollar held some ground against most other currencies during the last two days as investors are still waiting for the key US inflation data in the coming few days.
Oil prices, a key indicator of currency parity, rose on Thursday as falling US crude inventories amid rising refinery intake and a rise in Chinese imports last month supported higher demand expectations for the world’s two largest crude-consuming nations.
Pakistani Rupee Against US Dollar
Recently the local unit witnessed both appreciation and depreciation, against the American dollar with recent continued appreciation except for 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 US dollar, followed by a continuous fall for 17th consecutive sessions from October till the middle of November 2023.
However at the end of December 2023, and then in January 2024, the local unit mostly registered appreciation against the American dollar amid the inflow from the IMF followed by a $2b rollover from the UAE on January 20, 2024. On 29th February, China also rolled over $2b to Pakistan which was due in March 2024. As a result, the local unit improved by over Rs 7 in the interbank during the last eight to ten weeks.
In another recent development, Pakistan received $1.1 billion from the International Monetary Fund (IMF) in the final tranche of the $3 billion Stand-By Arrangement (SBA), on April 30. Pakistan is now looking to get a handsome and longer Extended Fund Facility (EFF) of the IMF programme to further expedite its economic stature. However, the public must be ready for further increases in prices in the country as the new IMF agreement is likely to be followed by further taxation.
