The emboldened Pakistani rupee pounded on the US dollar in the morning on Friday in interbank trading after receiving approval from the IMF to restart the loan programme.
The Pakistani rupee surged past the dollar by Rs. 1.05. As soon as trading began. The price of the US dollar is currently being traded at Rs208.75, down by Rs1.05.
The Pakistani rupee managed only a 30 paisa gain against the US dollar on Thursday, finishing the day at Rs209.80.
The market sentiment improved following the IMF’s confirmation that it had reached a staff-level agreement (SLA) with the Pakistani authorities for the conclusion of the combined seventh and eighth reviews of the programme supported by the EFF, clearing the way for the release of the eagerly anticipated $1.17 billion, which helped the rupee recover from its recent decline.
Prime Minister Shehbaz Sharif’s government, which assumed power in April and has effectively eliminated fuel subsidies and introduced new measures to broaden the tax base, has been severely unpopularly tightening its belt for months prior to the new agreement.
The IMF team’s leader, Nathan Porter, stated in a statement that “Pakistan is at a challenging economic juncture” and added that both external factors and domestic policies were to blame.
Pakistan’s economy, which suffers from subpar revenue collection and diminishing foreign reserves to pay its crushing debt, is in dire need of international assistance.
