Amid further delay in the revival of International Monetary Fund (IMF) loan programme, Pakistani rupee came under pressure on Thursday as it lost 1.13%, or Rs3.18, to close at Rs282.30 against the US dollar in the inter-bank market.
Conflicting reports about potential delay in resumption of the IMF programme pushed the rupee closer to the all-time low of Rs285.09 hit on Thursday last week. The currency stood just Rs2.79 away from the record low.
The rupee came under pressure after State Bank of Pakistan (SBP) Governor Jameel Ahmad, while briefing the Standing Committee on Finance, gave no timeline for achieving a staff-level agreement with the IMF. However, Finance Minister Ishaq Dar once again reiterated that Pakistan would strike the agreement in a few days as it remained absolutely committed to the loan programme.
The government has met almost all the prerequisite conditions for the loan programme.
Market talk suggests that the delay has created uncertainty about whether the country will manage to revive the programme and what will happen if it does.
The country is running out of time to mitigate the risk of default on foreign debt repayment.
China, however, has provided $1.2 billion over the past two weeks that has helped improve Pakistan’s reserves to $4.3 billion, which will provide import cover for almost a month.
The IMF programme will allow Pakistan to attract billions of dollars in financing from the fund as well as other multilateral and bilateral creditors to support its faltering economy.
Cumulatively, in the past two consecutive working days, the currency has lost 1.57%, or Rs4.43, to Rs282.30/$.
In the prior three working days, it recovered 2.6%, or Rs7.22, to Rs277.87/$ compared to the record low of Rs285.09 hit on last Thursday.
Published in The Express Tribune, March 10th, 2023.
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