Friday March 01, 2024

Rupee weakens against dollar in interbank market

Local currency loses Rs3.18 against greenback and closes at Rs282.30/dollar in interbank market

March 09, 2023
A representational image of a currency exchanger counting dollar notes. — AFP
A representational image of a currency exchanger counting dollar notes. — AFP

The Pakistani rupee slipped down against the US dollar in the interbank market on Thursday, as a staff-level agreement with International Monetary Fund (IMF) gets further delayed.

The local currency lost Rs3.18 against the greenback, to close at Rs282.30/dollar in the interbank market.

On Wednesday, rupee had depreciated Rs1.25 or -0.45% in the interbank market, and closed at Rs279.12. 

General Secretary Exchange Companies Association of Pakistan (ECAP) Zafar Paracha told The News that there was no major reason behind the depreciation as there was an upward trend in the market currently.

However, he said that it could be based on the delay in signing deal with the International Monetary Fund (IMF)

"People will remain in doubt until the government strikes the agreement and until it gets all the payments after approval," Paracha said, adding that the market will also be reluctant meanwhile.

Besides that, there was pressure from the IMF and foreign investors to weaken the local currency so that they can invest.

"They want to close dollar on a maximum rate and make the investments in PIDs or the government securities by 20-22%," he added.

Ishaq Dar rules out possibility of reaching SLA with IMF this week

Finance Minister Senator Ishaq Dar has ruled out the possibility of reaching a staff-level agreement with the IMF this week, however, assured that Islamabad was "very close" to sealing the deal as Pakistan had “satisfied “ the global lender.

“A staff-level agreement with IMF is unlikely this week," said the finance minister while addressing a seminar, titled 'Reviving economic stability through the strengthening of Public Financial Management'.

When asked if he had assured of striking the SLA by this week, Dar responded by saying that he had said "a few days not this week".

Earlier during the presser, the finmin admitted that it had taken longer than expected for Pakistan to complete the ninth review of the IMF's Extended Fund Facility (EFF), but had assured that Pakistan seemed to be very close to signing the SLA "in the next few days".

"I think we owe to this nation that we show seriousness, we deliver and we demonstrate to the world that we can honour the sovereign commitments no matter who made those," said Dar.