Dollar continues climb against rupee
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The value of the dollar on Thursday slightly increased in the open market and the interbank market by Re0.50 and Re0.20 respectively.
The greenback strengthened its value against the rupee to Rs163.50 in the open market, while in the interbank market, it hit Rs164.20 level.
The surprise big devaluation of the local currency took place after declaration by the State Bank of Pakistan governor that the exchange rate would be market-based and that the free float was not suitable for the country’s economy.
Earlier on Wednesday, the local currency shed its value by a whopping Rs7.2 in a single day to hit Rs164 in interbank trade ─ a record low ─ at the close of the day's trading. The greenback, yesterday, was being traded at Rs163 in the open market ─ showing an increase of at least Rs6.
In his first press conference, the new SBP governor had assured that the central bank would interfere in exchange rate if the market became volatile; exchange rate will be market-based and that the free float does not suit the country’s economy.
The exchange rate remained almost unchanged, hovering around Rs157 for more than a week while the market was feeling that the dollar could see depreciation against the rupee in the near future.
The PM House today issued a statement saying that the government was considering a special campaign targeted at ensuring that state departments improve their efficiency in controlling prices.
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On DawnNews
Comments (75) Closed
Jun 27, 2019 08:09pm
Thank you Mr. Jinnah
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Jun 27, 2019 08:15pm
The schedule banks earned an handsome figures in selling or purchasing foreign exchange especially USDs, the instant rise is phenomenal, in open market the dollar is lesser, while interbank rates are high. Obvious reason is high rate monopolistic spellings to importers for retirement of their documents in time constraints situations. The responsibility lies on newly appointed SBP Governor who belongs to infamous banking family, and certainly the conflict of interest is felt in recent waves .
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Jun 27, 2019 08:16pm
No surprises here...
Gordon D. Walker
Canada
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Jun 27, 2019 08:23pm
We are mentally agreed and ready for any take over but not ready to move with present govt .
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Jun 27, 2019 08:23pm
Don't know where it will stop..
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Jun 27, 2019 08:30pm
Where is ZAK ?
Are you not going to help Pakistan
retain it's "super power status"
in Asia ?!
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Jun 27, 2019 08:30pm
If this isnt free float market valuation, I dont know what is!
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Jun 27, 2019 08:30pm
Nothing to do with me.
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Jun 27, 2019 08:34pm
Side by side, timely leaked info says that finally our PM has decided to meet President Trump to obtain a solution from him about handling US $....
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Jun 27, 2019 08:34pm
There is a big difference between $$ strengthening and the PKR weakening. The latter is one of the indicators of a weak economy.
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Jun 27, 2019 08:36pm
Insane declaration by the State Bank of Pakistan governor that the exchange rate would be market-based has created a perplexing situation. Market based rates are even lower than the inter-bank rates. One an buy dollars from market and sell them to state bank, making a good profit.
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Jun 27, 2019 08:38pm
@UncleFunky, "Thank you Mr. Jinnah"
Misplaced inane scorn on our great Mr Jinnah from usual trolls!
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Jun 27, 2019 08:38pm
Medina Model or Venezuela model?
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Jun 27, 2019 08:38pm
@CELIA, ... Kicking us while we are down. Very decent of you.
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Jun 27, 2019 08:41pm
Because Pakistanis are buying more dollar to sell it later at higher Price and the chain continues...
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Jun 27, 2019 08:42pm
Hold on. Its difficult time. But Pakistan can surely survive.
What is not survive is the present govt., though.
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Jun 27, 2019 08:43pm
The PM House today issued a statement saying that the government was considering a special campaign targeted at ensuring that state departments improve their efficiency in controlling prices. _ Imran will wave a magic wand and everyone will cooperate.
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Jun 27, 2019 08:45pm
The dollar has fallen against the Canadian yen.
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Jun 27, 2019 08:45pm
it should be atleast 200 rs.
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Jun 27, 2019 08:47pm
become 30% richer in 6 months .... convert all money into US dollar and by end of year convert it back to 200rs/1us.
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Jun 27, 2019 08:49pm
When pkr was around 104, Pakistan's economy was valued almost 270 billion USD. Now that it has depreciated 60% to 166 per dollar, Pakistan's economy will be now valued to 160 billion USD.
Everything from loans to be paid will increase by 60% ...Similarly prices for crude and import will increase by 60% without any real market change in crude price. Pakistan need good economists asap.
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Jun 27, 2019 08:50pm
After 60% depreciation , Pakistan's economy is less than 180 billion USD...Which is less than bangladesh.
Congrats bangladesh and all the best pakistan
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Jun 27, 2019 08:52pm
@Celia, For Zak, China is the solution for all of Pak’s problems. If he were PM, he would make Pak as a territory of China.
Unfortunately some people don’t believe in themselves and abilities of their people.
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Jun 27, 2019 08:53pm
It's good for dollar but not for pak rupee.
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Jun 27, 2019 08:56pm
The down slide will continue till imf money is actually received. Against global norms of 90 days of imports in foreign currency reserves currently its about only 45 days.
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Jun 27, 2019 09:03pm
Dollar is not climbing but PKR is falling.
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Jun 27, 2019 09:11pm
We expect it cross the 200 limit by end of this year.
Good for expatriates, bad for locals unfortunately.
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Jun 27, 2019 09:12pm
Dollar, INR, Pound, Euro all climbing against PKR.
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Jun 27, 2019 09:16pm
@Desi Dimag,
You sussed it out brilliantly that when one goes up then the other falls, relatively. Einstein would have taken a bow at your brilliant mind!
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Jun 27, 2019 09:23pm
@Gordon the brain Walker, That's exactly what I've been writing Sir about the greeat headlines of most newspaper of Pakistan and how great economic reporters they have. The Rupee is falling and instead the headlines reading Rupee reaches a new low, they go on with the poor dollar gaining as if against all currencies.
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Jun 27, 2019 09:32pm
In a week it will be 1Taka equals 2 Pakistani Rupees.
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Jun 27, 2019 09:41pm
It will cross rs 180 in the next 2 weeks
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Jun 27, 2019 09:43pm
Insider trading, who owns dollars and control it in the market,it is not gov't or IMF who is doing this, truth must be told?
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Jun 27, 2019 09:46pm
IMF /no IMF. Inflation, increase in expenses. For get about that. Uncertainty prevailing. How the businesses will work? How poor can plan for his monthly expenses?Is PML (N)/PPP or PTI responsible? Doesn't matter. Big question is how the masses will survive? Difficult to survive on slogans.All politicians must try this. PPP and PML (N) don't have time for masses, they are busy in saving their leader. PTI is busy in accountability of corrupt as this is the only way for them to save their govt.
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Jun 27, 2019 09:49pm
I don't understand... Imran Khan is saying that Nawaz Sharif and Zardari increased Pakistan's debt from $6 billion to $30 Billion.
But Imran Khan getting $6 billion from Saudi Arabia, $2 billion from China and $6 from IMF, and ADB might also give $2.5 billion = total is ~14 to 16 billion. Now, why Imran Khan can't start returning loans with this money to stable the Rupee.
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Jun 27, 2019 09:52pm
What is the government doing about it?
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Jun 27, 2019 09:56pm
PTI's IMF borrowed team must clearly spell out what has been agreed and remove the uncertainty. Devaluation was due but overdoing it is creating a bigger crisis and it seems no one has the answer.
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Jun 27, 2019 09:59pm
Pakistan will make most of the external debt repayment and interest payment by the end of June. The dollar’s rise has increased because multinational companies are taking profits out of the country as the book closing date approaching that is June 30th. The demand for the dollar has increased, putting the interbank market under pressure. Rupee has been falling against greenback after an agreement with the IMF on a $6 billion loan on strict conditions including “market determined” exchange rate.
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Jun 27, 2019 10:00pm
Pakistan's exports failed to register growth in value terms despite the central bank letting the rupee depreciate. Exports dropped 2% to $22.34 billion in the first 11 months compared to $22.75 billion in the same period last year.
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Jun 27, 2019 10:00pm
Imran Khan will request another 6 months to fix the falling rupee............
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Jun 27, 2019 10:14pm
Good work
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Jun 27, 2019 10:18pm
@Amir, shame on you. If 1000 expats bring $1M and convert to Rs, $1B will provide stability. PTI should create a housing scheme for ex-pats which should be high tech. They can sell 1000 homes
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Jun 27, 2019 10:19pm
@CELIA, What do you mean retain super powa status? Pakistan is way ahead of everyone in S Asia when it comes to super powa status. No one can catch us..
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Jun 27, 2019 10:21pm
Greenback should be kept pkr200 from tomorrow.
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Jun 27, 2019 10:33pm
@Zahid, Already Rs 185 for bulk buyers. For small people ($ 1000 or so) it is Rs 165.
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Jun 27, 2019 10:42pm
Why is the dollar rising? So what exactly, makes the value of a currency rise or fall? The short answer: The price is set minute by minute by traders and investors who make bets on which way the market prices of a currency is headed. But there are more powerful, longer-term forces at work driving those bets. A country's currency is, in part, a reflection of how well or poorly its economy. And, for the moment, the U.S. is setting the pace for the rest of the world, that's dollar is rising.
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Jun 27, 2019 10:44pm
@Indian scientist, why do you want to convert $270b with 104pkr and then convert to $ with new exchange rate. $270b remains same even if the pkr falls.
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Jun 27, 2019 10:52pm
The boom in American's oil production and the crash in the prices of oil helped boost the dollar value. Oil is priced in dollars, and you can now buy more with the same number of dollars, by increasing the dollar's purchasing power relative to other currencies used to buy oil. Falling prices and rising oil production also improve the US. trade balance, by reducing the number of dollars sent abroad to pay for imported oil and raising the export volume of refined products such as gasoline.
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Jun 27, 2019 10:53pm
@M. Saeed, so that banks can accumulate dollar from the open market to pay the outgoing profits of FIIs and MNCs in dollar term. Horrible situation.
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Jun 27, 2019 11:16pm
At this rate...200 per USD by the year end cannot be ruled out... alarming and scary.
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Jun 27, 2019 11:25pm
@Sameer, agree.
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Jun 27, 2019 11:33pm
This NOT how currencies are devalued to reflect inflation differentials and trade imbalances. The way it's being done is a gift to speculators. Mere academic qualifications and only service in staff positions and no experience in Pakistan markets and society is the WORST background to be dropped with into the FX minefield. He has to go.
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Jun 28, 2019 01:02am
Pakistanis are just becoming more and more poorer by every passing day and IK has nothing to give to its country but only to snatch away. Now it's for the Pakistani citizens to decide their future ahead.
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Jun 28, 2019 01:02am
China, Russia, African and Asian countries need to sanction USD as a trade currency. Biggest fraudsters are who control the Zionist banking systems which nobody knows how it runs.
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Jun 28, 2019 01:04am
@Sameer, It is not Free Float, it is Free Drown!
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Jun 28, 2019 01:10am
@Kris, No it does not. Pakistan's GDP is expressed in Pakistan Rs AND US $. When expressed in Pakistani Rs it does not change. But for comparison ALL countries' GDP is expressed in US $. That means if our GDP was $270 b when the rupee was at 100 to a dollar, the same GDP now will be only be 170 bn when expressed in $s as the $ now buy 160 pakistani Rs. But remember our GDP did not change from when the Re was 100 to a $ to now when it is 160 to dollar. In fact it might have even gone up!
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Jun 28, 2019 01:36am
if this trend continues dollar price will be around 250-280 in 3-4 years
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Jun 28, 2019 01:43am
@Mansur Ul Haque, .... Slogans are good with rice.
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Jun 28, 2019 01:46am
@Amir, A good strategy.
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Jun 28, 2019 01:49am
@Amir, that’s the best to do if you are smart. Haters will be haters
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Jun 28, 2019 01:51am
@Colaking, the present government is the best in the world under PMIK
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Jun 28, 2019 01:51am
@Zahid, that was my prediction. I was very accurate
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Jun 28, 2019 01:55am
There is no need to panick. It’s all well planned and forseen by PMIK to improve investment. If you want to be safe buy dollars and then invest the conversion after a few months into our countries projects or loan it and sit and earn.
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Jun 28, 2019 02:03am
Everytime dollar goes up the value of pakistan's GDP value goes down. It's staring at under $225 billion at this time. Bangladesh is at 285 billion. I hope pakistan government understands this math!!
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Jun 28, 2019 04:51am
@CELIA, I am busy with my business here in Toronto, will be organizing fellow country men to stabilize the rupee.
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Jun 28, 2019 04:54am
@bhaRAT©, You sussed it out brilliantly that when one goes up then the other falls, relatively. Einstein would have taken a bow at your brilliant mind!
Thanks, you have even more brilliant mind.
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Jun 28, 2019 05:01am
If the same trend continues, we may send back same containers with PKR as we import goods....If someone can accept PKR
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Jun 28, 2019 06:01am
@Dabang, there is a difference between illusion and practical. The practical established.
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Jun 28, 2019 06:12am
@Indian scientist, yet our HDI and GDP per capita is little less than India and used to be higher for many years. Don't worry about Pakistan it is tough ecnomic times every country faces now and then. Worry about poverty in India.
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Jun 28, 2019 07:57am
@Kris,
No. Size of GDP dont increase but decrease with falling Rupee. Pakistan GDP at the moment by SBP is close to $236B at 1$=PKR 163.5. Pakistan GDP is still overvalued and will got down further. By next year it would be between $200B and $225B.
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Jun 28, 2019 07:59am
Pls tell us upfront the IMF deal. We need to know the price of Usd/pkr agreed, rate of interest agreed, fuel price agreed, rate of inflation agreed as well as drop in defense budget
Imran is unable to walk the talk
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Jun 28, 2019 09:20am
@Kris, though nobody has any idea of actual economic size of Pakistan your theory is wrong. Only solace you can have if hyper inflation have not eaten up the PPP of PKR. It's chance is bleak as Pakistan is an important based economy.
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Jun 28, 2019 09:24am
This is the wrong impression that dollar is appreciated, infact, the Pak rupee is on regular decline since the present govt. took charge last year and specially after agreement with IMF for a bailout package. Every foreign currency has increased against the Pak rupee. I remember, that in the Gen. Zia era in 1983 a Japanese yen was equal to 11 paisa Pakistani, now it is more than 100 paisa.
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Jun 28, 2019 09:44am
@Asjadfareed, 'GDP per capita is little less than India ". You guys have habit of living in illusions. India is at $2198 and Pakistan at $1357. If you still can call it "little less" I can just wish you luck.
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Jun 28, 2019 10:06am
Your JF17 had to be flown by so many pilots, at Paris air show. It only moved on the ground with manual power.
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