In September, Pakistan’s rupee has taken center stage on the globalfinancial scene, emerging as the leading performer worldwide. Thisremarkable turnaround can be attributed to the unrelenting efforts of theinterim government in curbing illicit dollar trading, as per a report byARY News citing Bloomberg.
Bloomberg’s analysis reveals that the Pakistani rupee experienced anextraordinary surge of nearly 6% over the course of September. Thisachievement stands out in stark contrast to most other currencies, such asthe Thai baht and the South Korean won, which witnessed declines againstthe US dollar. This decline was fueled by speculations surrounding theprolonged maintenance of elevated US interest rates.
Notably, the Pakistani rupee strengthened to a rate of 287.95 per dollar ona Thursday, marking a notable recovery from its record-low value ofapproximately 307 rupees earlier in the month.
Khurram Schehzad, the Chief Executive Officer of Alpha Beta Core SolutionsPvt. Ltd, a financial consultancy based in Karachi, highlighted thesignificant issue of leakages occurring through unauthorized hawala andhundi channels in the open market.
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These informal fund transfer systems are prevalent in South Asia. Schehzadexplained that as the USD rate began to reverse, various stakeholders,including hoarders and exporters holding their export proceeds, commencedselling their dollars, contributing to the rupee’s resurgence.
The Bloomberg report further illuminates the intensified efforts of thePakistani government in cracking down on individuals involved in theillegal dollar trade, a move that played a pivotal role in supporting thecurrency’s recovery. This concerted action underscores the government’scommitment to stabilizing the rupee and fostering a healthier economicenvironment in Pakistan.