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Rupee snaps 5-day long winning streak

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  • Rupee settles at 262.51 per dollar in interbank market.
  • Local unit closes open market trade at 269.
  • Pakistan’s REER index fall to 92.8 in January.

The Pakistani rupee snapped its five-day-long winning streak on Tuesday as the local currency shed 0.24% in the interbank market.

The local unit settled the day at 262.51 against the US dollar in the interbank market after a decline of Rs0.63 compared to Monday’s close of 261.88.

The last cycle of currency devaluation pushed Pakistan’s real effective exchange rate (REER) to 92.8 in January 2023 from 96.2 a month earlier, data from the State Bank of Pakistan (SBP) showed.

The decline in the REER — an index of the price of a basket of goods in one country relative to the price of the same basket in that country’s major trading partners — is driven by the rupee’s massive depreciation against the US dollar during the month of January.

In January, authorities decided to remove the cap on the exchange rate in a bid to meet one of the key lending conditions set by the International Monetary Fund (IMF) for the revival of its stalled $6.5 billion loan programme.

However, the rupee has maintained a rising trend in the last few days. Meanwhile, in the open market, the domestic currency loosed Rs1.25 to settle at 269 per dollar on Tuesday, according to the Exchange Companies Association of Pakistan.

Amid other developments, the National Assembly passed the IMF-dictated Rs170 billion Finance (Supplementary) Bill, 2023

Globally, the dollar index, which measures the US currency against six other rivals, was last at 104.11, just below a six-week high of 104.67 touched on Friday.

The market is now pricing US interest rates to peak at 5.30% in July and remain above 5% by the end of the year, moving away from expectations of deeper rate cuts this year. 

The yield on 10-year Treasury notes was up 2.3 basis points to 3.852%, after touching a three-month high on Friday. The yield of the two-year US Treasury paper, which typically moves in step with interest rate expectations, was up 3.5 basis points at 4.658%.

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Islamic Sukuk Bonds: Government Is Expected To Begin Bond Auction Next Week

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There is now more positive economic news for the people of Pakistan. The government is anticipated to begin the Sukuk Islamic Bond auction next week, after the central bank’s announcement of a large drop in the policy rate.

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SIFC Encourages Green Tourism: Reforming Visas to Increase Investment

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Enhancing investment in the tourism sector, Green Tourism Pakistan’s initiative has received backing from the Special Investment Facilitation Council.

Visa-On-Arrival for 126 countries, Visa-Free Entry for Gulf Cooperation Council nations, and 24-hour expedited visa processing are some of the main features of the Green Tourism Visa Policy.

It is anticipated that these endeavors will draw in about 80 million dollars in foreign direct investment and 8.3 billion rupees in domestic investment.

Green Tourism Private Limited has introduced hunting resorts in Naltar, Hunza, and Skardu, along with four- and five-star city hotels, to improve the tourism experience.

In the first phase of the project, 17 of the 78 areas have seen the start of development activity.

Approved is a central authority for Green Tourism that will supervise the growth of Air Operations.

To promote Religious Tourism, extra precautions have been taken to guarantee the security of visitors from all religions, including Sikhs and Buddhists.

Furthermore, in order to improve the quality of the tourist experience, the green guide quality program has been introduced to supply top-notch tour guides.

There is now a deluxe bus excursion from Islamabad to Peshawar that promotes local culture.

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July 2024 export data from Pakistan shows a significant rise.

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The Strategic Investment Facilitation Council (SIFC) has been instrumental in improving Pakistani products’ access to international markets, as seen by the significant surge in exports from the country at the start of the 2024–25 fiscal year.

With a 7.26% rise over the same month the previous year, July 2024 exports to the US were $476.017 million. After increasing by 7.74% annually, the United Arab Emirates emerged as the second-largest export destination.

The third and fourth places were occupied by exports to the UK ($183.303 million) and China ($60.100 million). A substantial increase in exports to Afghanistan was recorded in July of this year, rising from $46.262 million to $88.065 million, largely due to successful anti-smuggling efforts.

With a combined export volume of $553.951 million, more important export destinations included Germany, the Netherlands, Italy, Spain, Saudi Arabia, and Turkey.

A bright future for the national economy is suggested by the growing confidence major international markets have in Pakistani exports. Through the efforts of SIFC and the government, this greater access to global markets has been made possible.

Pakistan’s economy is predicted to remain stable as a result of the export growth that SIFC has enabled.

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