ISLAMABAD – The Pakistani rupee appreciated against the U.S. dollar with 10paisa in the interbank and closed at Rs155.27 on Friday.
Likewise, in the open market, it was being traded at Rs155.40 against thegreenback with slight fluctuation in the whole week.
Earlier, the World Bank Group had forecasted Pakistan’s economic growth toslow down for the next two years as it continues to face anothermacroeconomic crisis due to massive twin deficits and low foreign reserves.
Despite significant devaluation, the WB still sees the rupee overvalued bythe end of September by approximately 4.8%.
In the last three months, the local currency was observed to recoveragainst the greenback in both interbank and open markets.
Analysts had expressed fear that the intense ongoing trade war between theUnited States and China would result in fluctuation of the U.S. dollar inthe local market, and the value of the Pakistani rupee would stabilisedepending on the measures taken by the government with appropriate economicpolicies.
Currency traders were of the view that the increasing inflows of remittancehave supported the local rupee in the market.
Until June this year, the rupee was observed to cumulatively depreciateagainst the greenback, which in turn, had resulted in increased prices ofgoods and hardships for the general public.
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The SBP has let the rupee depreciate significantly in the inter-bank marketafter finalising an agreement with the International Monetary Fund (IMF)for a loan programme on May 12.
The IMF asked Pakistan to end state control of the rupee and let thecurrency move freely to find its equilibrium against the US dollar.
On the other hand, the World Bank Group has also supported the idea ofleaving the rupee free from state control in an attempt to give much-neededboost to exports and fix a faltering economy.
After the IMF lent the first tranche of $991.4 million to Pakistan, thelocal currency had depreciated massively.
The stringent conditions – on which the global moneylender has formallyapproved the bailout package of $6 billion for Pakistan – seemed to haveexerted more pressure on the local currency.
