According to forex dealers, the local currency has further depreciated by Rs 6.50 against the US dollar in the interbank market. The exchange rate of the dollar has reached a record high of Rs 269.10 in the interbank market today after being Rs 255.43 on January 26.
“The Banks are selling the US dollars to the importers at Rs 270.80, while the same is being sold between Rs267 to 270 in the open market”, the forex dealers said.
The drop came a day after the Exchange Companies Association of Pakistan (ECAP) removed the cap on the US dollar in a bid to end ‘artificial’ demand in the market, as part of IMF’s economic program. Pakistan had to agree to the IMF’s demand as the country is facing an acute balance of payment crisis and is in desperate need to secure its external financing. Pakistan received a $6 billion IMF bailout in 2019, which was topped up with another $1 billion last year to help the country following devastating floods. However, the IMF then suspended disbursements in November 2022 due to Pakistan’s failure to make progress on fiscal consolidation.
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Moreover, the Exchange Companies Association of Pakistan (ECAP) has removed the cap on the US dollar in a bid to end ‘artificial’ demand in the market. The ECAP secretary Zafar Paracha said in a statement;
“The association was withdrawing the cap on the greenback in the “nation’s interest” as the limit was causing adverse effects”
Following the rupee devaluation, gold prices also shot up to record high rates of Rs 202,500 per tola in the local market. The data released by All-Pakistan Sarafa Gems and Jewellers Association (APSGJA) suggests that the price of gold (24 carats) has increased by Rs 7,000 per 12 grams. The APGJSA President Haroon Chand said; “The resumption of the International Monetary Fund (IMF) program was mandatory to stabilize the market.”
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