Pakistan is expected to request a waiver from the International Monetary Fund (IMF) for violating its 1.25 percent premium limit between interbank and open market rates, while the lender sees the Rupee/Dollar rate to be below Rs. 300 by June 2024.
Pakistan will have to obtain a waiver from the IMF Executive Board to receive the next loan tranche due to the breach. The waiver is expected to be granted to Pakistani authorities since the lender expects the currency market to improve. It now expects the average price of US currency to be slightly less than Rs. 300 by June of next year, reported Express Tribune.
The lender sees the PKR/$ rate trending in the right direction, but a complete restoration to a market-based exchange rate is a priority.
The most recent IMF assumptions indicated that the average exchange rate could be less than Rs. 300 to a dollar by June 2024. This rate is lower than that used in the IMF’s staff-level report in July.
The government had drafted the budget for fiscal year 2023-24 at Rs. 290/$. Any higher rate will impact the defense budget, foreign debt servicing, the cost of running Pakistani missions overseas, and PSDP.
The IMF had raised the cost of interest payments on foreign debt from Rs. 822 billion to Rs. 1.022 trillion during the recent review. The year-end rupee/$ parity will be greater than this level if the average exchange rate is close to Rs. 300 to a dollar by June 2024.
The IMF has forecasted the size of Pakistan’s GDP at Rs. 105.9 trillion by June 2024. This is lower than the July forecast since it has reduced Pakistan’s growth expectation for the current fiscal year to 2 percent.
The lender also estimates the size of the economy to be $353 billion in dollar terms. It has also reduced the current account deficit forecast for the current fiscal year to $5.7 billion.
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Excellent review
Pakistan Rupee 225=1$US
June 2024
IMF prediction shall be wrong
N irresponsible
Kia Tale(oil) ke koonwe Nikal aye hai bahi.225 pe lane ke Liye qurbani Dena parti hai.jis ke lye na hukmran tyar Hein or na awam.
$ rate could be 150 if we start exporting
Minerals from Balochitan