KARACHI: The bullish trend of Pakistani rupee still continued against the US dollar as the local unit edged up by Rs2.39 in the interbank trading on Thursday.
As per the figures released by the money dealers, the rupee continued its robust upward march during the trading activity against the US dollar. The rupee smashed dollar bringing it down even below Rs230 threshold. The US traded for Rs229.75 in the interbank as the business ended for the day.
In the open market, the value of the dollar was depreciated by Rs1.50 and the American currency was exchanged for Rs230.50. Yesterday, the US dollar rate was settled at Rs232.12 at closing time. With the appreciation of the local unit, the debt volume of Pakistan has been reduced by Rs1,300 billion. During the last five trading sessions, the value of the dollar has decreased by Rs10.71.
The rupee keeps on gaining strength since Friday when the news of change of guards at the helms of finance ministry heralded. With Ishaq Dar assuming the role of new financial Czar, the market sentiments suddenly changed in favour of rupee both in interbank and open market. Even the open market has proved more docile where the exchange rate slipped by more than Rs10 in just three days.
Newly installed Finance Minister Dar who visited his ministry to take oath to his office on Wednesday gave a stern message during his talk to reporters that he won’t let manipulation of the exchange rate. He vowed that strengthening of Pakistani rupee was his top priority adding that it was not the right place where the rupee was standing today.
But many critics believe that the rupee’s resurgence would be short-lived as country is facing serious foreign exchange reserves crunch.
Way back in 2017 when Dar was the finance minister, he artificially kept the exchange rate stable by selling reserves of the State Bank. But this time round, there are not much reserves left with the central bank. Everyone is looking with bated breaths how Dar will be able to hold positive vibes at the market.
Besides low reserves, the country is also confronted with the large scale destruction wreaked by the biblical floods which requires billions of dollars in reconstruction effort.