Karachi March 9 2023: Pakistan Rupee depreciates in Interbank against dollar as country failed to reach agreement with IMF even after passing 28 days of staff level visit and strengthening of dollar on Powell statement of rate hike.
Central bank Governor Jameel Ahmad said on Wednesday that staff-level agreement (SLA) with the International Monetary Fund (IMF) was “close to finalisation” but did not disclose date and expects non-debt creating inflows to decline in this fiscal year.
Pakistan Rupee depreciates PKR 2.84 or 1.0 percent in Interbank to trade at PKR 281.96 at PST 10:40 on Thursday. During the week Rupee lost PKR 3.5 or 1.3 percent against the dollar in Interbank.
The dollar was perched near a three-month high on Thursday as Federal Reserve Chair Jerome Powell’s message that interest rates would have to go higher and possibly faster to tame inflation dominated sentiment and underpinned the U.S. currency.
The U.S. dollar index was largely steady, off just 0.01% to 105.62, and remained near a three-month peak of 105.88 hit in the previous session, having extended Tuesday’s 1.3% surge, its biggest daily jump since last September.
The Finance and Revenue Committee that met on Wednesday under the Chairmanship of Senator Saleem Mandviwalla here at ye Parliament House lamenting the sudden dollar fluctuation said that state bank is responsible to control and maintain the actual dollar rate and take solid measures to completely curb black marketing and smuggling of dollars.
Senator Mohsin Aziz pointed out that around 4 to 5 million dollars are being smuggled every year. The committee sought details of amount of dollars smuggled to Afghanistan in the recent period. It was also noted that due to high international inter banking rates, has resulted in Hundi and black money business, “ we can see the smuggling of dollar and black money business now being done through infants “ remarked Senator Mohsin Aziz. The committee recommended to seriously address the issue of varying dollar rate of open market inter banking and black market and bring the rate inconformity so that everyone receives a fair price. Saleem Mandviwalla also emphasised that rupee trade with Afghanistan be immediately stopped which is also contributing to external deficit.
The committee was also informed by the state bank officials that the remittances have also come down, so far 2 billion remittances took place and also there was a decline in exports from 7.4 pc during July. It was informed that the major decline in exports came from food especially rice by 12 pc. Vegetables and fruits exports have also been declined by 48 and 37 percentage respectively “ The remittances, the FDI and exports have come down the only thing risen are the loans” senator Mohsin Aziz commented. It was informed that the Government repaid 2.4 billion dollars in principle loans on net basis. It was also apprised that the Monetary Policy Committee (MPC) has further increased the Policy rate by 300 bps to 20 pc in its meeting on march 2nd.
