PKR bounces back, gains 1.6 rupees against USD in early trade

November 16, 2023 (MLN): The Pakistani Rupee (PKR) has snapped its losing streak, gaining 1.64 rupees against the US Dollar in the interbank market during early trade. 

The local unit is being quoted at PKR 286.49/286.98 [09:59am PST] with the trades being reported at 286.5 per USD as against yesterday's closing of 288.14.

This upswing follows the staff-level agreement successfully being reached between the International Monetary Fund (IMF) and Pakistani authorities on the first review under Pakistan's Stand-By Arrangement (SBA).

Pending approval by the IMF's Executive Board, the agreement will grant Pakistan access to SDR 528 million, which is around $700m.

This will bring the total disbursements under the program to almost $1.9 billion.

In the statement issued by the IMF yesterday, the Fund said that strengthening macroeconomic sustainability and laying the conditions for balanced growth are key priorities under the SBA.

The authorities’ policy priorities include returning to a market-determined exchange rate and rebuilding FX reserves.

While inflows following increased regulatory and law enforcement helped normalize import and FX payments and rebuild reserves, the authorities recognize that the rupee must remain market-determined to sustainably alleviate external pressures and rebuild reserves.

To support this, they plan to strengthen the transparency and efficiency of the FX market and refrain from administrative actions to influence the rupee.

To note, during the current financial year, PKR has depreciated against the Dollar by 0.51 rupees or 0.18%. While the current calendar year has seen PKR depreciate by 60.07 rupees or 20.97%.

In the open market, the exchange companies are quoting the dollar at 288.5 for buying and 290.5 for selling, compared to the previous closing of 289 for buying and 290 for selling.

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