Dar stick enables Pakistani rupee to show some spine to US dollar
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After a volatile trading session last week, the rupee resumed its upward trend as the local unit gained 24 paisas against US dollar in the interbank trading on Tuesday on the back of Finance Minister Ishaq Dar’s warning to dollar hoarders a couple of days ago, reported 24NewsHD TV channel.
According to forex dealers, the American currency saw a depreciation in its value during seesaw trading activity as it went down to Rs220.65.
Yesterday, the dollar was closed at Rs220.89.
The rupee which trounced at the hands of US dollar last week rose on Monday on the back of a strict warning issued by Finance Minister Dar during his meeting with the CEOs of commercial banks and heads of major exchange companies on Sunday.
The finance minister warned the smugglers of a strict action if they kept on hoarding dollars.
“Those individuals and banks involved in speculation will have to face the burnt as the authorities will take stern action against them,” Dar told the meeting participants.
The finance minister was of the view that the PKR was undervalued and its value should be below Rs200 mark. He also assured the stakeholders of the country’s “solvent state,” fully capable of fulfilling local and international debt commitments.
Dar held the meeting with the exchange companies’ heads on the heels of his two-day visit to China (which is starting today). He is expected to make a loan rollover request to China to help the country to avoid default-like situation.
The biggest worry for Pakistan is its dwindling foreign exchange reserves.
Though the IMF has resumed its extended loan programme for the country, and the Asia Development Bank has disbursed $1.5 billion funds, besides $2 billion support coming from the World Bank, but the country is still facing the liquidity crunch mainly because of debt servicing and a bloating trade deficit.
Reporter Ashraf Khan