ISLAMABAD  - In an unprecedented development, Pakistani currency is gaining its lost value against the US dollar that is depreciated by Rs1.66 in a single day (Monday) and valued at Rs101.46 in interbank.
Dollar was traded at Rs 101.46 in interbank and Rs 101.66 in open market on the first day of this week. The US currency, which was traded at Rs 112 last year, has started downward journey from last few days apparently due to handsome inflow of dollars in the country. Before this massive devaluation of dollar, the exchange rate remained stable at Rs105-06 for a period of about two months. Market sources are of the view that US dollar might be valued under Rs100 in next few days if current exercise continues.
“One of the reasons behind rupee strengthen is dollar inflow in the country. Similarly, the exporters also started to sell their dollars keeping in view its declined value”, a currency dealer told The Nation. He further said that earlier, exporters used to keep their proceeds for more than the allowed 130 days in a hope to sell their holdings at a better rate. However, current decline in US dollar has forced them to sell.
“This is basic market principal that whenever dollar inflow exceeded than its outflow, it strengthen the reserves and eases pressure on exchange rate, as happening in the country”, said eminent economist Dr Ashfaque Hassan Khan, who is also dean at NUST School of Social Sciences and Humanities.
Dr Khan while quoting a newspaper report said, “Pakistan has reportedly receive $750 million from Pakistan Development Fund, which increased the State Bank of Pakistan’s held foreign exchange reserves to $3.9 billion and help in easing pressure on rupee”. The market sentiment has improved with reported inflow of $750 million, which help in lessen the pressure on country’s exchange reserves.
Situation is likely to further improve in the months to come as huge reserves are expected to receive from different sources, which would help in further stabilising the Pakistani currency against the US dollar. The government is expecting to generate around $2 billion from the auction of 3G and 4G telecom licences next month (April). Similarly, the government is expecting to receive substantial amount out of pending $800 million from Etisalat against the privatisation of PTCL.
The government has also started privatisation of the public sector entities that would also fetch billions of rupees for the national kitty. The government has also sent $1.6 billion pending bill to the United States for reimbursement under coalition support fund (CSF). Therefore, Pakistan is expecting major chunk out of $1.6 billion to be released in next few months. Country’s foreign exchange reserves would increase due to the rationalisation of the aforesaid amount well on time.