The rupee continues to gain value against the dollar, rising by up to Rs 5.36 during Monday morning in interbank market.
Before the General Elections, the Pakistani rupee slumped to a record-low Rs 130 against the US dollar, going on to stabilize at Rs 128 as election season kicked in.
It has now gained a strong foothold as the Pakistani rupee now stands at Rs 122.5 in the interbank market.
Increase in Value
The rise in the rupee’s value was recorded as a result of the increased inflow of dollars to the country. Samiullah Tariq, Head of Research at Arif Habib Limited, says,
The dollar has dropped in the interbank market against PKR as there is certainty in the balance of payments with the news of inflows from multiple channels including Credit line from IDB. The market is incorporating this news of reducing uncertainty on the balance of payments front positively.
About the further rise in the value of the rupee, Tariq told:
I don’t think the PKR appreciation is going to continue as this will hurt exports. However, the excessive depreciation will stop as inflows are expected.
Another positive outcome out of the rupee’s appreciating value is that Pakistan’s net debt would decrease by Rs 450 billion.
However, another major economic situation is looming for the new government-in-waiting. According to a report by the Financial Times, Pakistan would need a massive bailout package of $12 billion from IMF to meet its external financing needs.