Rupee Gains Big Against US Dollar After IMF Breakthrough

The Pakistani Rupee (PKR) reversed losses against the US Dollar (USD) and posted gains in the interbank market today.

It appreciated by 0.52 percent against the USD and closed at Rs. 206.87 after gaining Rs. 1.06 in the interbank market today. The local unit hit an intra-day high of Rs. 206.65 against the USD during today’s open market session. Since 11 April, the greenback is up by Rs. 24.51 against the PKR.

The rupee ended its losing streak against the dollar today after the International Monetary Fund (IMF) sent the Memorandum of Economics and Financial Policies (MEFP) for the Seventh and Eighth Reviews to Pakistan earlier today. This means that the release of the next tranche is very likely now.

Pakistan is ready to receive the next tranche from the IMF in early July. Talks between the two sides are expected to resume on 28 June (today), and Minister Ismail and the Governor of the State Bank of Pakistan (SBP) will sign the contract with the IMF on behalf of Pakistan.

Pakistan has requested the IMF to enhance the loan program by $2 billion to $8 billion instead of $6 billion. It has also asked for a one-year extension in the program that will take it to 2024.

Globally, oil prices soared for a third day on Tuesday as major producers Saudi Arabia and the United Arab Emirates looked unlikely to be able to increase output significantly, and political unrest in Libya and Ecuador added to supply concerns.

Brent crude barely settled above $117, while the US West Texas Intermediate (WTI) stayed above $111 at $111.5 per barrel, adding to yesterday’s 1.7 percent increase.

The PKR reversed losses against the other major currencies in the interbank market today. It gained 30 paisas against the Canadian Dollar (CAD), 46 paisas against the Australian Dollar (AUD), Rs. 1.01 against the Euro (EUR), and Rs. 2.13 against the Pound Sterling (GBP).

Moreover, it gained 29 paisas against the Saudi Riyal (SAR) and 29 paisas against the UAE Dirham (AED) in today’s interbank currency market.