The Pakistani rupee has gained further strength against the US dollar, reaching a high of 275 in the interbank market due to Pakistan securing $500 million from the Industrial and Commercial Bank of China (ICBC), as well as expectations of a deal with the International Monetary Fund (IMF).
The rupee also closed the week on a high note, gaining 2.38% against the dollar, closing at 278.46. Financial experts cite the hype created by the country’s financial institutions and international players as the reason for the earlier dollar appreciation, and expect the dollar to remain in the range of 260 to 265 due to the IMF agreement and inflows from friendly countries.
However, the destabilised currency still damages Pakistan’s image and discourages foreign direct investment (FDI) and local investors.
Experts stress the need to increase Pakistan’s tax base and manage expenditures to reduce the subsidies given to elites, which could have a significant impact on the country’s financial stability.
Government officials are hopeful of striking a deal with the IMF in the coming days, though no time frame has been given for finalising the agreement.
