SBP exchange rate model to remain intact: spokesman

ISLAMABAD: After taking decision to move towards market based flexible exchange rate in a bid to strike agreement with the IMF, Ministry of Finance on Friday categorically stated that the State Bank of Pakistan (SBP) model pointed out to the real effective exchange rate at equilibrium value, indicating that there is no requirement of massive adjustment in exchange rate at the moment.

In the wake of continued rampant speculations on possibility of free fall of rupee against dollar, the Ministry of Finance on Friday preferred to come on the record by stating that there was no range on exchange rate discussed with international partners. “Clearly no target of Pak/USD exchange rate is envisaged,” stated Dr Khaqan Najeeb, Adviser and Spokesman for Ministry of Finance on Friday in a tweet.

He said that all speculations were baseless and unfounded and further said that SBP economic model pointed to the Real Effective Exchange Rate at equilibrium value. “The Balance of Payment (BOP) stability ensured with a fall in current account deficit and more than adequate financing availability”, he added.

“Discussions with international partners do not entail any target level of exchange rate. The focus is on further strengthening the exchange rate regime aligning it and keeping it consistent with the evolving macroeconomic fundamentals of the economy”, he concluded.