Pakistani Rupee continues to appreciate against US Dollar

Pakistani rupee continued its momentum against the US dollar, as it appreciated further against the greenback on Wednesday.

PKR trajectory against the US dollar remained in an upward direction, as USD dropped below 153 mark at the interbank.

As per details, the Pakistani rupee closed at 152.76 against the USD at the interbank, showing an appreciation of 0.22 percent. The PKR opened the trading day at 153.100 against USD, it dropped to the day low of 151.200 before it rebounded.

The strengthening of PKR against USD continues after Pakistan on Tuesday night received around $500 million from International Monetary Fund (IMF) as a loan tranche under Extended Fund Facility (EFF) for budget support. The State Bank of Pakistan (SBP) confirmed that it has received an IMF tranche amounting to $ 498.7 million (equivalent to SDR 350 million) under the Extended Fund Facility.

These inflows will help to build the country’s foreign exchange reserves and reduce the pressure on the external accounts. The country’s total liquid foreign exchange reserves stood at $ 20.435 billion as of March 19, 2021, and with the arrival of these inflows the total foreign exchange reserves are likely to cross $21 billion mark.

Furthermore, Pakistan launched a three-tranche bond deal on Tuesday to raise $2.5 billion comprising tranches of five, 10, and 30 years for which it received over $5.3 billion in combined orders in its first international bond sale since late 2017.

Last year, the government and SBP launched Roshan Digital Account to provide banking facilities to overseas Pakistanis to attract more foreign inflows. Roshan Pakistan Account has also received over $500 million deposits during the last five months.

So far this year, the US currency has depreciated sharply by Rs 6.13, however, the prices of essential commodities continue to move upwards and the inflation rate remains high.

It is pertinent to mention that the fall in the value of the dollar has not only reduced Pakistan's import bill, but also billions of rupees in external debt.