PKR bounces back by around three rupees against USD on IMF approval

August 30, 2022 (MLN): Snapping its losing streak, the Pakistani rupee (PKR) has recovered by almost three rupees in the interbank market at around 9:54 am on Tuesday mainly due to the positivity stemmed from the IMF front. 

The local unit was traded at 219.02/220.02 with trades being reported at 219 per USD compared to the previous close of 221.92 per USD. 

IMF’s Executive Board has approved the seventh and eighth tranche of its stalled Extended Fund Facility (EFF) as per which Pakistan will soon receive $1.17 billion, Federal Minister for Finance and Revenue informed on Monday.

The board’s decision allows for an immediate disbursement of the aforestated amount, bringing total purchases for budget support under the arrangement to about $3.9bn. 

IMF in a statement, noted, "Pakistan is at a challenging economic juncture. A difficult external environment combined with procyclical domestic policies fueled domestic demand to unsustainable levels."

The resultant economic overheating led to large fiscal and external deficits in FY22, contributing to rising inflation and eroded reserve buffers, it added.

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