Rupee recovers to 162.50 against dollar

KARACHI: The Pakistani currency strongly recovered Rs4.40 to Rs162.50 against the US dollar in intraday trade in the interbank market on Friday.

"The gain is seen after IMF (International Monetary Fund) approved an emergency loan of $1.4 billion last night and G20 group countries deferred Pakistan’s debt repayment worth $10 billion by one year in response to the coronavirus pandemic," Exchange Companies Association of Pakistan (Ecap) former secretary-general Zafar Paracha said.

The local currency had closed at Rs166.88 on Thursday, according to the State Bank of Pakistan (SBP).

Scheduled inflow of dollars - including from other bilateral and multilateral global financial institutions - and limited outflows extended the much-needed support to rupee.

A massive drop in international oil prices would also help Pakistan save $5 billion on the oil imports in a year, he said. The development also supported the uptrend in rupee.

The notable inflows and limited outflows would keep the country’s foreign currency reserves on a higher side. "The developments have addressed the balance of payment problem as well," he said.

In addition, the government and SBP measures to support the contracting economy also supported the rupee upward drive, he said.

"Before the massive recovery, rupee had lost Rs.0.40-0.50 in the morning," he said.

"The rupee may recover to Rs155-160 against the dollar if things remain under control,” he added.