US dollar strikes back as Pakistani rupee tumbles

F.P. Report

KARACHI: The US dollar did not have to wait long to display its superiority as the greenback struck back at the Pakistani rupee on Friday, reversing the rupee’s winning streak.

The US dollar started the day with marginal loss against the Pakistani currency as it shed four paisas in the interbank trading. According to forex dealers, the greenback failed to break the Pakistani rupee’s upward trajectory during the Friday morning activity as the US currency was traded at Rs197.55, down by four paisas.

But a few hours later the tables have turned. The greenback struck back at the Pakistani rupee and made a handsome gain of 26 paisas and was being traded at Rs197.85.

According to parity figures provided by the State Bank of Pakistan yesterday, the US dollar was closed at 197.59 after a gain of 14 paisas from Wednesday.

In a drastic move, the rupee was able to stop the upward trend in the US dollar’s value during one week as the local currency has been recovered by Rs4.46 after hitting an all-time low at Rs202.01 on May 26.

The otherwise feeble rupee has been resuscitated on the expectation that Pakistan would be able to get $1 billion tranche from the International Monetary Fund as the government has withdrawn the fuel subsidy and hiked petrol prices by Rs60/L within a week, besides raising electricity tariff by Rs7.91/ unit – two main conditions the Fund has been asking the government to fulfil for the revival of its loan programme.

However, the economic experts are of the view that government’s decision to ban import of all luxury and non-essential items has done the wonders and reduced traders’ demand for rupee.