US dollar crashes against Pakistani rupee in interbank
March 10, 2023 11:19 AM
After pummeled by the US dollar for a couple of days, the Pakistani rupee staged a strong showing in the interbank market on Friday apparently on the basis of improved foreign exchange reserves, reported 24NewsHD TV channel.
According to the State Bank of Pakistan, the local currency soared by Rs1.53 against the US dollar and ended the trade at Rs280.77.
On Thursday, the rupee remained at the receiving end against the US dollar, depreciating by 1.13%. As per the State Bank of Pakistan (SBP), the rupee settled at 282.30 against the greenback, a decline of Rs3.18 in the interbank market.
The SBP-held foreign exchange reserves rose above the $4 billion mark after the cash-strapped Pakistan received a $500 million loan installment from a Chinese bank on Thursday. The SBP said that its foreign exchange reserves have increased by $487 million to $4,301 million as of the week ended March 3, which will provide an import cover of around a month.
The SBP received $500 million last week from the Industrial and Commercial Bank of China (ICBC) as part of the institution's $1.3 billion facility, just days after it had received $700 million from the China Development Bank.
Pakistan hasn't received funds from any friendly country except for China as the $350 billion economy struggles to revive the stalled International Monetary Fund (IMF) programme.
Cash-strapped Pakistan has been trying to secure the IMF bailout to avert a debt default, unlock more funding and stave off severe supply shortages. There are $7 billion of repayments in the coming months, including a Chinese loan of $2 billion due in March, according to Fitch Ratings.
The nation needs to repay about $3 billion dues in the upcoming payments while $4 billion is expected to be rolled over, SBP Governor Jameel Ahmad said in a briefing.
In a related development, SBP Governor Jameel Ahmed has also said that the current account deficit is projected at $7 billion for the ongoing fiscal year against the budgetary target of $10 billion subsequent to measures taken to control imports.
Moreover, he informed the National Assembly Standing Committee on Finance that the inquiry report against certain banks on account of foreign exchange manipulation has been completed, indicating variation in banks’ forex profits during a specific period.
Reporter Ashraf Khan