Meteoric dollar shatters all records, closes at Rs200 – Business

Data from the Pakistan Foreign Exchange Association (FAP) showed that the US dollar closed at a surprising milestone of Rs200 in interbank trading on Thursday afternoon, moving up Re1.00 from the previous day’s close of Rs199.

According to FAP data, the US currency reached an all-time high of Rs200.10 in the interbank market around 1:45pm and then fell to Rs200 at the close. At 3:50 PM, it was trading at Rs201 on the open market.

The day before, the US dollar rose more than two rupees above Tuesday’s close and settled at 199 rupees at the end of the session, the latest for the US currency to break an all-time high since last Tuesday.

The FAP closed at 199 rupees the day before, but data released by the Central Bank of Pakistan showed the closing price was 198.39 rupees, still very close to the 200 rupees the international currency had expected to reach a day earlier. An explanation of growing income bills, growing current account deficits and depletion of foreign exchange reserves.

The dollar has already reached Rs200 on the open market yesterday.

According to Saad Bin Naseer, Co-Founder and Director of the web-based financial data and analytics portal Metis GlobalThe rupee’s decline is largely due to a lack of clarity about the government’s plans to stem the decline in foreign exchange reserves.

He noted that central bank reserves have fallen by $7.5 billion since January 1, adding that importers have gone into panic buying as it is uncertain whether the government will be able to secure funding from China, Saudi Arabia and the International Monetary Fund (IMF). This is an ongoing conversation.

“Meanwhile, exporters are holding back imports abroad as the rupee continues to depreciate,” he said.

‘Black Kist Day’

This milestone has puzzled some experts.

FAP Secretary-General Zafar Paracha spoke on the exchange rate today. Today was “the darkest day” in Pakistan’s history.

FAP Chairman Malik Bostan commented: Serb.comIt urged the Federal Revenue and Revenue Service (FBR) to issue a statutory regulatory order for the implementation of decisions taken to limit imports.

said Abdullah Zaki, importer and former chairman of the Karachi Chamber of Commerce. Importers suffered the most from the appreciation of the dollar.

He added that import costs increased by 20% last month, which would affect prices for foods such as lentils, milk powder and tea.

Zaki advised that the SBP could lock the dollar exchange rate in the interbank market for a certain period of time to contain impending inflation. He also demanded that tariffs on food not be raised.

Meanwhile, Assad Rizby, former finance director of Chase Manhattan, said: Metis Global That “annuity cost, circulating debt [of] Article Rs2.5, public institutions [worth] 1.2 trillion rupees and a fiscal deficit of nearly 8 percent is unsustainable and is putting pressure on the rupee.”

Meanwhile, “Independent SBP” was “not worried about the PKR plunge and probably [an] IMF results” Metis Global report quoted from him

Rising oil prices in recent weeks have already doubled the cost of importing oil for the country, and overall imports have hit all-time highs. Imports rose 72% in April, leaving no room for the government to improve its balance of payments.

Moreover, the central bank’s foreign exchange reserves reached $10.3 billion, the lowest since June 2020.

Currency dealers said unexpectedly high import costs and low foreign investment did not support the exchange rate, and a current account deficit of more than $13 billion already remains a challenge for the government.

IMF bailout under discussion

As Pakistani officials resumed negotiations with the IMF yesterday, Finance Minister Miftah Ismail said the new coalition government would remain in power, make tough decisions and implement the reforms promised in the original funding program, a complete structural benchmark.

An informed source said the talks started on a healthy note as both sides appeared to converge on a key principle that separates the country’s economic decision-making from politics.

The source said the government would revise fuel and energy prices within a few days and ban all of them instead of raising tariffs on about 30 major luxury items, such as cars and mobile phones, in addition to some luxury items. Includes income and hence external accounts. These announcements will be made soon to advance the conversation for successful completion of the modified program.