KARACHI: Pakistani rupee, after falling against the dollar for three consecutive sessions, reversed the trend on Monday, gaining Rs1.58 or 0.72 percent in the interbank.
As per the State Bank of Pakistan (SBP), the rupee closed at 220.89 after an appreciation of Rs1.58.
Interbank closing #ExchangeRate for todayhttps://t.co/9Imo431QCZ pic.twitter.com/I7K5pHr8yx
— SBP (@StateBank_Pak) October 31, 2022
During the previous week, the rupee fell 0.73% against the US dollar. Its reported shortage in the open market and the long-march announcement by Pakistan Tehreek-e-Insaf (PTI) Chairman Imran Khan caused a bit of a stir among official circles.
Ishaq Dar, the federal minister of finance and revenue, announced on Saturday that the government has started making steps to minimize volatility and maintain the exchange rate at its genuine value.
Dar issued a warning that those institutions discovered to be engaging in illegal practices will face harsh punishment. He requested that ECs and banks refrain from manipulating the dollar.
The Ministry of Finance has stated that the currency rate will have a major impact on the trajectory of inflation in its Economic Update and Outlook for October 2022.
“Moderating inflation also contributes to exchange rate stability, which in the benign case may generate a virtuous inflation-exchange rate cycle. Further, exchange rate stability requires sound economic fundamentals. Besides inflation, also a manageable current account deficit and guaranteed financing of this deficit by healthy financial inflows are required. When markets get convinced about these prospects, speculative bubbles in the exchange market would be highly unlikely,” read the report.
