Business

Rupee sinks further, falls to new low against US dollar

Published

2 years ago

Farwa

Local unit closes at 287.29 against the US dollar.
Rupee down 2.25 against greenback in interbank market.
Importers have resumed the panic buying of US dollars.

Pakistani rupee touched a record low on Tuesday as the country struggles to unlock critical International Monetary Fund (IMF) funding while dwindling foreign exchange reserves become another source of concern for investors.

The local unit, in the interbank market, closed at 287.29 against the US dollar, 0.78%, or Rs2.25, down from Monday’s close of 285.04.

Last month, the rupee hit a record low, closing at Rs285.09 per US dollar on March 2, 2023, the data released by the State Bank of Pakistan (SBP) showed.

A trend curve of rupee-dollar parity. — Arif Habib Limited

Financial pundits believe that importers have resumed the panic buying of US dollars, while the supply of foreign currency remained low in the interbank market.

Pakistan’s loan programme is yet to materialise months after it raised taxes and energy prices and allowed the currency to depreciate to meet IMF’s conditions. The nation has missed multiple deadlines to resume its bailout.

The cash-strapped nation secured a $6 billion IMF bailout in 2019. It was topped up with another $1 billion last year to help the country following devastating floods, but the IMF then suspended disbursements in November due to Pakistan’s failure to make more progress on fiscal consolidation.

After months-long unfruitful talks, the Washington-based lender has asked Pakistan to seek commitments for new loans from Saudi Arabia and the United Arab Emirates before it revives the bailout.

The IMF’s resident representative for Pakistan said the country has a few more tasks to complete to meet requirements for a $6.5 billion bailout. The lender approved a $3 billion loan program for Sri Lanka last month to ease its economic crisis.

“Uncertainty on IMF and friendly countries inflow affecting rupee,” said Mohammad Sohail, CEO of Topline Securities.

“Some of the ruling coalition partners are due to visit Saudi Arabia next week and it is a key event to watch,” it added.

Finance Minister Ishaq Dar will be leading a high-powered delegation to the US which will attend the upcoming annual spring meeting of the Bretton Woods Institutions, known as the IMF and World Bank, from April 10 to 16.

Moreover, the country’s foreign exchange reserves have also declined in recent weeks, which is another source of concern for investors. The forex reserves held by the central bank stand at a critical level of only $4.24 billion (as of March 24, 2023).

Business

Pakistan suffers a loss of millions due to inoperable airports.

Published

20 hours ago

Farwa

The Pakistani economy is strengthening and trending in the right direction, according to Federal Minister of Finance and Revenue Senator Muhammad Aurangzeb on Thursday.

Speaking at the Pakistan Saudi Arabia Business Forum, Aurangzeb stated that the goal of the government was to support the private sector rather than engage in commerce. His goal was to encourage business-to-business (B2B) trade and investment, thus he welcomed the delegation from Saudi Arabia.

Within the last 12 to 14 months, the minister saw a considerable improvement in macroeconomic stability. With the help of foreign exchange reserves sufficient to cover two months’ worth of imports, Pakistan steadied its currency, decreased its current account deficit to less than $1 billion, and produced a primary surplus.

Strong remittances, expanding exports, and a drop in inflation from 38% to 6.9% have all contributed to the consolidation of these benefits, according to Muhammad Aurangzeb. Companies have also profited from the insurance rate reduction.

Even if Pakistan’s credit rating has improved, more work needs to be done to bring it up to at least a B-. Both on the debt and equity sectors, he claimed, institutional flows were returning to the nation.

As the International Monetary Fund (IMF) board approved an extended program for the nation, the Islamabad Stock Exchange set a record high.

He stated that the IMF program will implement structural reforms in addition to ensuring macroeconomic stability for the long run.

The government of Pakistan remains committed to structural changes, sustainable growth, and tax reform, as stated by Muhammad Aurangzeb.

Business

Pakistan’s economy is getting better, according to Muhammad Aurangzeb

Published

20 hours ago

Farwa

The Pakistani economy is strengthening and trending in the right direction, according to Federal Minister of Finance and Revenue Senator Muhammad Aurangzeb on Thursday.

thus,Speaking at the Pakistan Saudi Arabia Business Forum, Aurangzeb stated that the goal of the government was to support the private sector rather than engage in commerce. His goal was to encourage business-to-business (B2B) trade and investment, thus he welcomed the delegation from Saudi Arabia.

As the International Monetary Fund (IMF) board approved an extended program for the nation, the Islamabad Stock Exchange set a record high.

He stated that the IMF program will implement structural reforms in addition to ensuring macroeconomic stability for the long run.

The government of Pakistan remains committed to structural changes, sustainable growth, and tax reform, as stated by Muhammad Aurangzeb.

Business

Remittances from Workers

Published

2 days ago

Farwa

In September of this year, the State Bank of Pakistan reported that remittances from overseas Pakistanis amounted to 2.8 billion dollars, reflecting a 29% increase compared to the remittances received in September of the previous year.

The SBP reports that, with a cumulative inflow of 8.8 billion US dollars in the first quarter of the financial year, workers’ remittances increased by 38.8 percent compared to the first quarter of the previous year.

Remittance inflows in September 2024 were primarily derived from Saudi Arabia at $681.3 million, the United Arab Emirates at $560.3 million, the United Kingdom at $423.6 million, and the United States of America at $274.9 million.