Pakistani rupee up as government confirms key IMF deal

Dubai: The Pakistani rupee could see an immediate recovery, the government confirming that a key step has been taken in obtaining the essential funds released by the IMF. The PKR had been going through high volatility since March, sliding to successive lows during this period.

Pakistan has received “combined economic and financial targets” for the seventh and eighth reviews of its bailout package from the IMF, Reuters reported, according to Pakistan’s finance minister. On Twitter, FM Miftah Ismail said the government had received the memorandum of economic and financial policies (MEFP) from the lender for both reviews, following meetings last week between the two sides.

“This will lead to the release of nearly $1 billion initially by the IMF and then another $2 billion,” one analyst said. “Most importantly, Pakistan can expect favorable credit flows from some of its key allies, much like what China has done recently.

“Before the release of IMF funds, some amendments will have to be adopted in the National Assembly. It would be imminent. So most likely the funds will be released before Eid.

heavy with turbulence

On June 21 and 22, the PKR traded at 212.25/212.27 to the dollar. Currently it sits at $206 – “What we expect from the IMF deal is a reduction in extreme volatility and a stabilization of the exchange rate,” a Treasury official said. a major money transfer house.

Early Tuesday (June 28), the exchange rate in the UAE is hovering at 56.25 per dirham.

The PKR is expected to “trade around 200 by the end of this quarter after securing the $6 billion loan from the IMF,” according to analysts’ expectations.

Syed Asif Zaman

In fact, the strengthening towards 207/$ began after the government signed a $2.3 billion loan facility with a Chinese banking consortium, giving a boost to the country’s declining foreign exchange reserves. Yet the PKR has plunged more than 16% so far this year as Southeast Asian economies grapple with high import bills and a growing current account deficit, coupled with the decline in Moody’s credit ratings.

– Syed Asif Zaman, CEO of Ahmad Alagbari, a Dubai-based accounting firm

About Tammy N. McFarlane

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