The Pakistani rupee continued to strengthen against the dollar in the interbank on Thursday despite the flood emergency triggering economic and humanitarian losess in the country.
The dollar shed Rs1.5 and was trading at Rs217.25 in the interbank market during intraday trade as of 10:10am.
The unit has lost Rs4.67 during the last three sessions since the International Monetary Fund bailed Pakistan out from the risk of slipping into default.
Early estimates put the damage from the floods at more than $10 billion, government officials have said, adding that the world had an obligation to help the South Asian country cope with the effects of man-made climate change.
The major reason for the rupee’s uptrend was due to the deposit of much needed $1.16 billion from the International Monetary Fund’s (IMF)
“Today, SBP has received proceeds of USD 1.16 billion (equivalent of SDR 894 million) after the IMF Executive Board completed the combined seventh and Eight reviews under the Extended Fund Facility (EFF) for Pakistan,” wrote the bank.
The bank said that the funds will improve the SBP’s foreign exchange reserves.
“[It] will also facilitate realisation of other planned inflows from multilateral and bilateral sources,” read the statement.
With the revival of the IMF programme, Pakistan is expected to receive funds from multilateral and bilateral organisations, apart from friendly countries.
Economist and former adviser to the federal ministry of finance Dr Khaqan Hassan Najeeb said that the IMF programme resumption would certainly help build Pakistan’s depleting foreign exchange reserves, but the flood devastation has increased the country’s foreign financing needs.
