Pakistani rupee recovers sharply on political stability and declining demand
Pakistani rupee saw a sharp recovery on Friday, gaining 13.78 per US dollar to close at 285.8 in the interbank market. This follows a record low of 300 on Thursday. The currency’s recovery was due to a decrease in demand from importers and an “improved” political situation. The demand for US dollars declined after oil payments were released a day earlier, while the Supreme Court’s declaration of Pakistan Tehreek-e-Insaf (PTI) Chairman Imran Khan’s arrest from court premises as “illegal” also improved the political situation. However, the country is still facing a dollar shortage and its foreign exchange reserves are currently enough to cover just one month of imports.
The sharp recovery of the Pakistani rupee was due to two significant developments that took place over the last few hours. Firstly, the currency gained strength after a decline in demand from importers, as oil payments were released a day earlier. Secondly, the Supreme Court declared Imran Khan’s arrest from court premises as “illegal” and ordered authorities to release him “immediately”. These two factors led to a sharp recovery in the rupee, which retraced its losses and closed at 285.8 in the interbank market.
The Supreme Court’s declaration regarding Imran Khan’s arrest from court premises was a crucial factor in the rupee’s recovery. The declaration was viewed positively by investors, who saw it as an improvement in the country’s political situation. The PTI Chairman is seen as a potential challenger to the current government, and his arrest was viewed as a threat to political stability. The court’s ruling was therefore seen as a positive development that would help to stabilize the country’s political situation.
The decline in demand from importers was also a crucial factor in the rupee’s recovery. According to market sources, the demand for US dollars declined as oil payments were released a day earlier. This led to a decrease in demand for US dollars and an increase in the value of the Pakistani rupee. The decline in demand from importers was a significant factor in the rupee’s recovery, and it helped to stabilize the currency after it had fallen to a record low of 300 on Thursday.
Despite the rupee’s recovery, the country is still facing a dollar shortage. Its foreign exchange reserves are currently enough to cover just one month of imports, and it is facing delays in securing a loan from the IMF. The cash-strapped nation of over 220 million people is facing an economic crisis, and its currency market has been facing a dollar shortage since last year. The country’s economic crisis has made it difficult for it to secure loans from international institutions, and it has been struggling to meet its financial obligations.
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The Pakistani rupee has remained volatile due to uncertainties surrounding the IMF program. The currency market did not react negatively to Finance Minister Ishaq Dar‘s statement that Pakistan would not default even if there was no IMF program. The currency has been volatile over the last few days, with the local unit losing over Rs20 in the last three days. The uncertainties surrounding the IMF program have sparked default concerns, and the country is facing challenges in securing a loan from the IMF.
The recovery of the Pakistani rupee is a positive development, and it is a sign of improvement in the country’s political situation. The decline in demand from importers and the Supreme Court’s declaration regarding Imran Khan’s arrest from court premises helped to stabilize the currency after it had fallen to a record low of 300 on Thursday. However, the country is still facing a dollar shortage, and its foreign exchange reserves are currently enough to cover
