KARACHI: The dollar dropped 40 paisa against the rupee and was selling at Rs139.60 in the early hours of the open market trade on Monday.
The green back fell slightly below its closing price of Friday when it was trading at Rs140. The dollar has been hovering at the level of Rs140 for two weeks, an indication that it has become stable for now. A similar trend was observed in the inter-bank market where it fell slightly and traded at Rs138.95 when trading opened.
On November 30, the dollar jumped Rs9.5 to Rs143.5 in the interbank market in what remains its highest intraday gain and highest ever level in its history respectively. However, it has come down to Rs140 since then.
The surge in dollar price against the Pakistani rupee is due to the change in our exchange rate policy and rising value of dollar in international market. All major currencies that were pegged against the dollar depreciated this year.
Pakistan has moved away from a managed exchange rate regime to a free float policy, allowing the market forces of demand and supply to determine the dollar price. The State Bank of Pakistan says there is a demand and supply gap in the market, which has been causing this movement.
Since the change of policy, the dollar has appreciated more than 30%, witnessing two of its biggest ever single day jumps in the short span of one-and-a-half months. In the first week of December 2017, a dollar was worth Rs106 compared to the current rate of Rs140.
Pakistan is expected to join the IMF programme in March and will be able to get between $6 to $7 billion or even more depending upon its need, which will help stabilize exchange rates.
