Islamabad: uncertainty about the renewal International Monetary FundThe bailout package for Pakistan has put a lot of pressure on the local currency because U.S. Dollar Recording a record fall in the value of the rupee in the interbank market, it rose to Rs 212 on Tuesday.
Pakistani Rupee The US dollar saw a sharp decline in April since Islamabad held inconclusive talks with the IMF, indicating that the country was now completely dependent on fund bailouts.
In July 2019, Pakistan signed a 39-month, $6bn Extended Fund Facility (EFF) with the IMF, but it had halted disbursements of nearly $3bn, claiming that the previous Imran Khan-led government had funded And energy subsidies in February this year.
Currently, the IMF is also concerned about the targets set by the current government for the coming financial year.
However, Finance Minister Mifta Ismail posted on Twitter on Monday that IMF Program Will revive within a day or two but their claim so far has failed to control the depreciation of the rupee.
A recent Dawn report quoting diplomatic sources claimed that the US has agreed to help Pakistan negotiate a deal with the IMF.
Earlier, media reports claimed that Islamabad was “seeking Washington’s support” to renew its EFF with the IMF. As the largest shareholder, the US has been reported to have considerable influence on IMF decision-making.
According to observers, the reason for the rupee depreciation has also been attributed to quarter-end payments due to Pakistan’s rising import bill, widening current account deficit and depletion of foreign exchange reserves. So far, the country’s import bill has already crossed $70 billion in the outgoing year.
The latest devaluation of the rupee on an almost daily basis began earlier this week, when traders resorted to panic over rumors and speculation that some commercial banks were running out of forex.
Malik Boston, President forex association of pakistan (FAP) attributed the rapidly depleting foreign exchange reserves to put pressure on the rupee.
“After a long time, forex reserves have come down to single digits, which is worrying the market,” he told reporters.
Traders have called upon the State Bank of Pakistan (SBP) to play its due role in controlling the rupee’s fall. However, the central bank appears helpless in controlling the situation as it cannot supply dollars to the market to support the rupee as its stock of the dollar stands at a dwindling level.
According to the SBP, Pakistan’s reserves have declined by another $234 million. SBP’s share of these reserves is just below $9 billion.
According to Boston, the demand for dollars is also high due to the upcoming pilgrimage to Mecca. “This year more than 4,00,000 Pakistanis are going for Haj and buying dollars. This is adversely affecting the local currency,” he said.
Pakistani Rupee The US dollar saw a sharp decline in April since Islamabad held inconclusive talks with the IMF, indicating that the country was now completely dependent on fund bailouts.
In July 2019, Pakistan signed a 39-month, $6bn Extended Fund Facility (EFF) with the IMF, but it had halted disbursements of nearly $3bn, claiming that the previous Imran Khan-led government had funded And energy subsidies in February this year.
Currently, the IMF is also concerned about the targets set by the current government for the coming financial year.
However, Finance Minister Mifta Ismail posted on Twitter on Monday that IMF Program Will revive within a day or two but their claim so far has failed to control the depreciation of the rupee.
A recent Dawn report quoting diplomatic sources claimed that the US has agreed to help Pakistan negotiate a deal with the IMF.
Earlier, media reports claimed that Islamabad was “seeking Washington’s support” to renew its EFF with the IMF. As the largest shareholder, the US has been reported to have considerable influence on IMF decision-making.
According to observers, the reason for the rupee depreciation has also been attributed to quarter-end payments due to Pakistan’s rising import bill, widening current account deficit and depletion of foreign exchange reserves. So far, the country’s import bill has already crossed $70 billion in the outgoing year.
The latest devaluation of the rupee on an almost daily basis began earlier this week, when traders resorted to panic over rumors and speculation that some commercial banks were running out of forex.
Malik Boston, President forex association of pakistan (FAP) attributed the rapidly depleting foreign exchange reserves to put pressure on the rupee.
“After a long time, forex reserves have come down to single digits, which is worrying the market,” he told reporters.
Traders have called upon the State Bank of Pakistan (SBP) to play its due role in controlling the rupee’s fall. However, the central bank appears helpless in controlling the situation as it cannot supply dollars to the market to support the rupee as its stock of the dollar stands at a dwindling level.
According to the SBP, Pakistan’s reserves have declined by another $234 million. SBP’s share of these reserves is just below $9 billion.
According to Boston, the demand for dollars is also high due to the upcoming pilgrimage to Mecca. “This year more than 4,00,000 Pakistanis are going for Haj and buying dollars. This is adversely affecting the local currency,” he said.