The US dollar plunged to Rs 2.63 against the Pakistani rupee (PKR) on Monday as Ishaq Dar was appointed as the country’s finance minister.
The exchange rate closed at Rs 237.02 against the dollar, recording a gain worth Rs 2.63 in rupees against last Friday’s close of Rs 239.65 on the interbank FX market.
Dollar Tumbles to PKR as market welcomes Dar nomination
Markets reacted positively to his current PML(N)-led coalition government’s nomination of Ishaq Dar as finance minister, according to currency experts.
Ishaq Dar is expected to take over his responsibilities on Tuesday, according to reports. The day before, Mikhta Ismail announced he was stepping down as his finance minister. Experts said the market expected the return of the dal to improve the rupee’s value. Previously, Dahl was known to have served as Finance Minister and controlled exchange rates. However, Dar has been criticized for artificially stabilizing local currencies.
Earlier in the day, the dollar fell by more than 4 rupees, but then offset the previous day’s losses.
It is worth noting that the rupee rose against the dollar last Friday after suffering his 15th consecutive decline. During this period, the local currency depreciated by PKR 21.10 against the dollar and has fallen to PKR 218.60 since the interbank closure on September 1, 2022.
The local currency hit a record low at Rs 239.94 per dollar on 28 July 2022.
Currency experts said the rupee had recovered due to a narrowing current account deficit. Pakistan’s current account deficit fell by 19% in the first two months (July-August) of the current financial year 2022/2023.
Furthermore, experts said recent actions by the SBP have also helped boost the value of the rupee. However, the rupee has not received any support following recent announcements by the State Bank of Pakistan (SBP) regarding Saudi Arabian funds.
Heavy rains and flash floods have cost Pakistan’s economy more than $10 billion in losses. The devastation will drive the country to boost imports, especially of agricultural products, over the next few days.
The rupee also fell as foreign exchange reserves continued to dry up.
