Recent times have seen the US dollar dominating exchange rates, leaving banks and forex companies powerless. Currency specialists argue that the rates given by these institutions are not reflective of the actual situation. Fears of repercussions from the State Bank prevent banks from revealing the true state, while forex companies are similarly reluctant.
On Tuesday, the State Bank reported the dollar’s closing price at Rs303.05 in the interbank. However, the Exchange Companies Association of Pakistan listed the open market rate at a higher Rs318. Insiders suggest that due to the IMF’s import conditions and inadequate dollar inflows, banks are hesitant to fulfil the demands of importers, causing them to avoid opening letters of credit for imports.
Contradicting circulating financial reports, bankers deny any forthcoming massive dollar inflow into Pakistan or nearing the conclusion of discussions with the IMF. They are skeptical of these speculative claims and are focused on the tangible situation, encouraging a careful approach to imports and exchange rates.
Since the interim government’s induction, the situation has deteriorated. “The dollar value jumped by Rs14.40 to Rs303.05 from Rs288.65 on Aug 11 in just 18 days of this government,” stated Atif Ahmed, a currency dealer. By comparison, the open market rate on Aug 11 was Rs296.
In 18 days, the British pound increased by Rs27 to Rs403, the euro grew by Rs21 to Rs345, and the Saudi riyal appreciated by Rs6.25 to Rs85.50. Interestingly, remittances play a crucial role, with substantial inflows from countries like Saudi Arabia, the UK, the US, and the European Union. However, of these, only the riyal’s price is linked to the US dollar; other currencies have distinct international values, which are currently rising against the rupee.
Read: Dollar Rate Differential Poses Hurdle for Pakistan’s IMF Agreement
