Rupee stands firm at 286.71 against dollar

SBP's previous instructions to commercial banks to allow only priority-based selective imports withdrawn

KARACHI:

Pakistani rupee on Monday slightly appreciated by Rs0.03, or 0.01%, and closed at Rs286.71 against the US dollar in inter-bank dealings compared to Friday’s level of Rs286.74.

According to market players, there was some optimism that the government would be able to clinch a long-delayed agreement with the International Monetary Fund (IMF), resulting in the release of over $1 billion in loan tranche.

On Friday last week, the government, in a bid to meet an objective of the IMF’s loan programme, lifted the ban on all imports with immediate effect.

According to a notification issued by the State Bank of Pakistan (SBP), its previous instructions to commercial banks to allow only priority-based selective imports stand withdrawn and imports are fully reopened with immediate effect.

The move was backed by Finance Minister Ishaq Dar in a statement read in parliament on Saturday, which said that “there will be no restrictions on imports. All conditions are removed.”

Talking to The Express Tribune, Pakistan Business Council CEO Ehsan Malik commented that the government had apparently fulfilled some of the IMF’s conditions, but not all, “to buy time and stay in the game … by giving an impression that the IMF has not abandoned its loan programme.” Ismail Iqbal Securities Head of Research Fahad Rauf, however, said that the exchange rate could turn volatile (hitting Rs300-350/$ compared to the current level of Rs286-287/$) if the government implemented its decision in true letter and spirit by fully reopening all imports.

Published in The Express Tribune, June 27^th, 2023.

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