Amid falling foreign exchange reserves and bitter pills the federal budget going to reveal today, the Pakistani rupee managed to float strongly against the US dollar in the interbank market on Friday. As per the information obtained from the forex dealers, the local currency was appreciated by 16 paisas against the greenback and was currently being traded at Rs285.65. On Thursday, the US dollar was depreciated by seven paisas against the local currency and ended the day at Rs286.81.

In a related development, the State Bank of Pakistan (SBP) has said that its foreign exchange reserves had decreased by $179 million. During the week ending on June 2, the total foreign exchange reserves of the Pakistani central bank fell to around $3.9 billion. The decrease was "due to external debt repayments", the SBP statement added. Net foreign reserves held by commercial banks came at $5.4 billion, the State Bank said. Total liquid foreign reserves stood at about $9.3 billion, according to the SBP.

Meanwhile, Esther Perez Ruiz, the International Monetary Fund (IMF) resident representative for Pakistan, said that the country has to satisfy the lender on three counts, starting with a budget to be presented on Friday before its board will review whether to release at least some of the $2.5 billion still to be disbursed under a lending programme that will expire at the end of this month. The IMF official asked Islamabad to restore proper functioning of FX market, pass budget consistent with IMF programme objectives, secure credible financing commitments ahead of last Board meeting.

Credit: Independent News Pakistan-INP