The Pakistani Rupee surged by almost Rs5.45 against the US dollar during the month of March amid low demand for the greenback.
Now market sources are expecting that dollar might stabilise around Rs150 with the PKR continuing to gain ground amid an increase in foreign exchange reserves.
In a single month, the US dollar shed almost Rs6, Rs5.45 to be exact, in the interbank market. On March 1, the dollar was being traded at Rs158.4 (selling) and Rs157.9 (buying), whereas on March 31, the dollar after considerable decline is selling at Rs152.95 while the buying rate is 152.45 in the interbank market.
Market analysts think it will go down further, as in the light of the newly-released $500m tranche by the International Monetary Fund (IMF) and the inflow of money through Roshan Digital Accounts will help the rupee on its upward flight.
The government has also raised $2.5 billion through Eurobonds — one more reason for a stronger rupee. Another factor is the State Bank of Pakistan not buying dollar from the market and an increase in inflow due to the imports.
Experts are saying that it will decline further. But will it touch Rs150? The head of the Pakistan Forex Association thinks so. According to Malik Bostan, the dollar will likely decline to Rs150 in the coming days. “I am seeing the US dollar being traded between Rs150-152,” he said, adding the PKR has a bright future in the light of the current economic policies.
A local currency dealer in Lahore was rather more optimistic. He said that the dollar will fall below Rs150 Open market is giving as low as Rs 145 level in coming month. “The greenback will continue to depreciate against the PKR,” he said, claiming that it will hit Rs145.
Due to travel bans and coronavirus lockdowns, the dollar’s demand plunged in the last few weeks.
Travel agents said that Pakistanis usually use dollars for Umrah, educational, and health expenses. But there’s a lull in business activities, so buying during the pandemic would remain low, they predicted.