On the open market, the value of the rupee has risen dramatically versus the US dollar.
5,5 percent improvement In the open market, the value of one US dollar has fallen to Rs295.
On Thursday around midday, the value of the Pakistani rupee reached a one-week high versus the US dollar on the open market, rising by a stunning 5.5%, or Rs16.
According to the Exchange Companies Association of Pakistan (ECAP), the exchange rate for the rupee on Wednesday night was $311.
As a result, the disparity between the interbank and open market rates for the dollar has shrunk to roughly Rs10 from around Rs27 the day before.
The exchange rate between the rupee and the dollar, or Rs285, has been relatively stable in the interbank market for the previous few weeks.
As the gap between the two markets’ valuation of the rupee widened, the IMF urged the government to “focus on restoration of proper foreign exchange market functioning.”
After the central bank permitted commercial banks to buy US dollars from the interbank market to settle international payments made by credit card customers, a major correction occurred in the open market.
Previously, they were averaging daily interbank purchases of $10 million to clear international credit card transactions.
On Tuesday, the open market value of the rupee hit a new low of Rs312/$ due to the demand from commercial banks.
After the central bank permitted banks to purchase dollars from the interbank market on Wednesday, ECAP General Secretary Zafar Parachs projected a significant adjustment in the market’s rupee-dollar parity.
He predicted a 20-25 rupee appreciation over the following couple of days, with a 15-20 rupee appreciation on Thursday (today).
Prior to the resumption of the IMF loan programme before its official expiration on June 30, 2023, financial experts predicted another round of rupee depreciation of 5-10% to Rs300-310/$ in the interbank market.
With foreign exchange reserves down to a dangerously low $4.2 billion, the currency has remained under pressure versus the US dollar.
However, Pakistan has $3.7 billion in external debt that it must pay by this month of June.
After June 2023, the country will be at greater danger of defaulting on foreign payments due to low reserves and scheduled debt repayments if the IMF programme remains stuck.