KARACHI: The Pakistani rupee (PKR) appreciated against the United States dollar (USD) on Tuesday after the country received much-needed funds from Saudi Arabia.
The price of the USD declined after the country witnessed a boost in foreign reserves after Saudi Arabia deposited $2 billion to the State Bank of Pakistan. The dollar became Rs1.30 cheaper in interbank trading and is trading at Rs.278.5.Â
The Pakistan Stock Exchange (PSX) also rallied amid signs of improved economic situation after the cash-strapped country secured the funds.
The benchmark KSE-100 index increased by over 500 points in early trading and crossed the 45,000 points barrier. At around 12:24pm, the index gained 555.18 points or 1.24% to jump to 45,140.30 points, up from the previous close of 44,585.12 points.
Finance Minister Ishaq Dar said that Pakistan has received $2 billion deposit from the Kingdom of Saudi Arabia (KSA) in the State Bank of Pakistan (SBP),
“On Friday, our reserves had closed in at less than $10 billion, standing at roughly $9.67 billion so you can now imagine them close to $11.67 billion,” he said. “You can expect this $2 billion to reflect starting this Friday in the State Bank reserves,” the minister added.
The finance minister also said that he expected “further positive developments” in the coming few days that would help to stabilize the country’s economy.
The inflows comes after Pakistan reached a standby-agreement with the International Monetary Fund (IMF) deal on June 30. Pakistan is set to receive $3 billion over a period of nine months, pending approval by the IMF’s board, which is scheduled to convene on July 12.
On the other hand, the Fitch Ratings has upgraded Pakistan’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘CCC’ from ‘CCC, indicating a positive development towards the betterment of the country’s economy
The rating agency has identified key indicators that contributed to the positive development rating for the country which include improvement in easing external financing risks.
