KARACHI:
The US dollar fell by Rs1.48 to Rs217.27 in the interbank market on Thursday, after the State Bank of Pakistan received the first tranche of $1.6 billion from the International Monetary Fund (IMF).
In addition to the IMF loan, financial aid from the United Nations and other countries for flood victims helped depreciate the dollar for the third consecutive day.
Foreign investments during the year and reduced oil imports due to declining demand in the resource sector caused by the ongoing floods also strengthened the local currency against the greenback.
Analysts were also of the opinion that global oil prices may decline further if the US and Iran reach a nuclear agreement and the development would benefit Pakistan as the country would be able to take full advantage of oil supply from the neighbouring country.
These positive expectations have led to a decreased demand for the US dollar in both the open market and the interbank market.
Two days after the Executive Board of the International Monetary Fund (IMF) revived Pakistan’s bailout programme, the State Bank of Pakistan (SBP) received proceeds of $1.16 billion (equivalent of SDR 894 million) from the global lender on Wednesday.
The IMF said Pakistan’s economy will grow to around 3.5% but the average inflation rate is estimated at 19.9% — the projections that had been made before the floods destroyed vast swathes of the country.
The global lender also approved an increase in the loan size to $6.5 billion and extended its expiry date to June 2023. The $6 billion original programme was going to end next month with half of the amount undisbursed due to the failure of the PTI government to fulfil its commitments
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