Business

Pakistani rupee continues to take a hammering amid political uncertainty

Published

3 years ago

Farwa

Rupee hits all time low, depreciates to 226 against US dollar in interbank market.
Pakistan Stock Exchange witnesses negative trend.
KSE-100 index falls 248 points to 40,140 points.

After shattering all previous records, the Pakistani rupee on Wednesday further depreciated to Rs226 after losing 4.1 against the US dollar in the interbank market.

The Pakistani rupee had hit an all time low on Tuesday as well of 224 against the dollar in the afternoon interbank trade, before closing at 221.99.

It was the highest day-on-day depreciation after June 26, 2019 when the currency fell by Rs6.80.

Meanwhile, the Pakistan Stock Exchange witnessed a negative trend as the KSE-100 index fell 248 points to 40,140 points.

PML-N’s thumping in the Punjab by-elections triggers political uncertainty

The ruling PML-N’s thumping in the Punjab by-elections has triggered political uncertainty along with import pressure taking the Pakistani rupee on a downward trajectory.

Analysts believe, however, that the domestic political and economic situation are not the only factors at play.

“The dollar is getting stronger in the global market almost against all the world currencies and the Pakistani rupee is not the exception,” said Alpha Beta Core CEO Khurram Schezad.

‘IMF is yet to be on board’: Khurram Schezad

Speaking of Pakistan’s financial situation, Schezad said that the country’s external account issues “are not settled as yet, the IMF (International Monetary Fund) is yet to be on board, and the flows are yet to materialise”.

“Global rating agencies have put a negative outlook on the economy, so that is an additional burden that is weighing on the financial markets in general and foreign exchange market in particular,” he added.

Exchange Companies Association of Pakistan (ECAP) Chairperson Malik Bostan Malik Bostan told Geo.tv that there were three reasons behind the constant devaluation of the local unit.

The forex expert said that investors are jittery at the moment as the Opposition PTI has bagged more seats than the PML-N in the Punjab by-polls — creating uncertainty over the future of the current set-up.

Bostan said that the speculations that the IMF’s Executive Board approval would take time and the money lender’s statement of being ready to negotiate with a caretaker government have exacerbated the devaluation.

He also pointed out that since the Taliban took over Afghanistan, Pakistan has provided them trade relief, resulting in additional pressure on the rupee.

The currency trader said that the State Bank of Pakistan (SBP) cannot intervene in the rising rupee-dollar parity as the country has agreed that the central bank will not intervene in the matter.

“…but even if it wishes to intervene, the SBP does not have enough dollars to inject into the market,” he said, adding that if the government wants to save the rupee, it will have to curtail the imports.

Business

Robust activity lets PSX climb above 115,000 level again.

Published

5 hours ago

Farwa

On Friday, the Pakistan Stock Exchange (PSX) resumed its upward trend, crossing 115,000 points once more.

The PSX had strong action in the morning session, as the KSE-100 index increased by 1,000 points to 115,138.

The notoriously volatile PSX closed Thursday at 114,037 points, up 594 points.

DOLLAR DEPRECIES

Meanwhile, in the interbank market this morning, the US dollar fell 7 paisas to Rs278.65 against the Pakistani rupee.

Business

SBP will announce monetary policy on January 27.

Published

5 hours ago

Farwa

The State Bank of Pakistan (SBP) will release its monetary policy on Monday.

The Monetary Policy Committee (MPC) of the SBP will convene on the first day of the following week to make decisions on monetary policy.

The Monetary Policy decision will be announced by Governor SBP Jameel Ahmad at a news conference on the same day after the MPC meeting, according to an official release.

In December, the central bank reduced policy rates by 200 basis points (bps) to 13 percent.

“In November 2024, headline inflation fell to 4.9 percent year on year, meeting the MPC’s estimates. This decrease was mostly caused by the ongoing decline in food inflation and the phasing out of the impact of the gas tariff increase in November 2023,” SBP stated in an official release.

“However, the Committee noted that core inflation, at 9.7 percent, is proving to be sticky, while consumer and business inflation expectations remain volatile.” To that end, the Committee restated its previous assessment that inflation may remain volatile in the short term before stabilizing within the target range.

“At the same time, growth prospects have slightly improved, as evidenced by a recent increase in high-frequency indicators of economic activity.” Overall, the Committee concluded that its approach of gradual policy rate decreases is keeping inflationary and external account pressures under control while promoting long-term economic growth.

Business

Finance Minister Meets With World Leaders at World Economic Forum in Davos

Published

1 day ago

Farwa

During his attendance at the World Economic Forum in Davos, Switzerland, Finance Minister Muhammad Aurangzeb has met with officials of organisations and leaders of many nations.
Bangladesh’s Chief Advisor, Muhammad Younas, met with Mohammad Aurangzeb.
On the fringes of the World Economic Forum’s Annual Meeting 2025 Opening Banquet, there was an informal meeting.
Additionally, the Finance Minister met with Anwar Ibrahim, the Prime Minister of Malaysia.
Both leaders discussed economic cooperation and bilateral ties.
Muhammad Aurangzeb also had a meeting with Dp World’s Rizwan Soomro and Yuvraj Narayan.
They talked about how to strengthen Pakistan’s logistics and infrastructure systems to support trade.
“The Pakistani government is committed to advancing joint projects and values partnerships in both business-to-business and business-to-government cooperation,” the finance minister added.