Sehar Timings Mar 29 - Ramazan 18

Lahore
LHR
04:36 AM
Karachi
KHI
05:12 AM
Islamabad
ISB
04:38 AM
Peshawar
PWR
04:42 AM
Quetta
QTA
05:07 AM

News

APBF wants solid steps as rupee volatility continues despite IMF loan program

September 18, 2022 11:40 PM


The All Pakistan Business Forum (APBF) on Sunday called for taking bold steps and effective measures, as the rupee still continued to witness a volatile trend in the process of trading against the dollar and other major currencies despite the fact that the IMF program is now back on track, securing the external financing requirements for the current fiscal year.

The APBF President Syed Maaz Mahmood observed that being back in the IMF program amid the falling global commodity prices and full coverage of external financing needs, there is no basis for the continuation of the high volatility in the exchange rate, as the local currency sustained losses during the whole week, and was hovering at 235 level against the US dollar in the market.

He said that the inflow of funds from the International Monetary Fund helped add to the gains of the Pakistani rupee for just a few sessions. However, economic issues continued to engulf Pakistan reported its Consumer Price Index (CPI) at a multi-decade high of 27.3% on a year-on-year basis in August 2022 from a year earlier, as authorities warned that massive flooding in the country could exacerbate already skyrocketing prices.

The APBF Chairman Ibrahim Qureshi stated that by having a clear policy to curb the volatility in the exchange market, the central bank should be fully geared to act and monitor the movements more vigilantly and should be ahead of the curve as they have more information than an average market player.

Ibrahim Qureshi said that foreign exchange reserves held by the State Bank of Pakistan are not stable yet, as the reserves’ position is critical for Pakistan which is desperately seeking dollar inflows to meet its balance-of-payments needs. A low level of reserves caused severe pressure on its currency market with the rupee witnessing its worst monthly performance in July in over 50 years.

APBF President Syed Maaz Mahmood observed that besides increasing exports and controlling imports the government will have to take administrative measures, as a large demand for cash dollars is seen in the market. He said that there was a complete breakdown of economic policymaking, as the country’s fiscal policy had become subservient to monetary and exchange rate policies.

He said that the central bank has a stated policy to intervene wherever volatility needs to be curbed without changing the direction, which is now essentially market-determined. The policy is being pursued vigorously in the daily movement. However, the volatility on a weekly or monthly basis often turns out to be detrimental for businesses. Since the exchange rate is flexible, speculators jump in; they make quick bucks due to currency volatility.

It is to be noted that globally, the dollar was headed for its continuous gain and standing near its highest levels in decades against the euro and yen, with investors in little mood for selling ahead of US labour data that could bolster the case for aggressive interest rate hikes.



Most Read

  1. Man murders young sister by smothering her with pillow in Toba Tek Singh Man murders young sister by smothering her with pillow in Toba Tek Singh
  2. Aitchison College students, parents stage protest against principal’s resignation Aitchison College students, parents stage protest against principal’s resignation
  3. Five Chinese among six killed in Shangla suicide bombing Five Chinese among six killed in Shangla suicide bombing
  4. Sahiba meets her father for the first time Sahiba meets her father for the first time
  5. Maaz Safder regrets 4-year relationship with wife Saba Maaz Safder regrets 4-year relationship with wife Saba
  6. ‘Khaie's incredible ending receives rave reviews and big applause ‘Khaie's incredible ending receives rave reviews and big applause

Opinion

  1. IMEC to sabotage CPEC
    IMEC to sabotage CPEC

    By Dr Asif Channer

  2. 1947 TO FORM 47
    1947 TO FORM 47

    By Dr Asif Channer

  3. Beijing wants to further highlight industrial sector in its country and take scientific innovation to new heights....
    Beijing wants to further highlight industrial sector in its country and take scientific innovation to new heights....

    By Ali Ramay

  4. Global race: China will reduce its unnecessary expenses
    Global race: China will reduce its unnecessary expenses

    By Ali Ramay

  5. Channer Pir: The Great Saint of Cholistan
    Channer Pir: The Great Saint of Cholistan

    By Dr Asif Channer

  6. Literate the Religious Illiterate
    Literate the Religious Illiterate

    By Dr Asif Channer