IMF loan sees rupee gain Rs1.8 against US dollar

ISLAMABAD: After the International Monetary Fund (IMF) approved a $1.1 billion loan to bail Pakistan out, the rupee surged Rs1.8 against the US dollar in the interbank trade.
According to data released by the State Bank of Pakistan on Tuesday afternoon for interbank trading, the rupee closed out the day at Rs220.12.
The data showed that the rupee, which had sunk to Rs221.92 on Monday, regained 0.82% ground against the greenback.
Earlier during trading on Tuesday morning, the rupee gained as much as Rs1.42. The appreciation meant that a US dollar was being traded for Rs220.50. However, the value of rupee appreciated by 0.82% in the interbank by the end of the day.
This is up from Rs221.92, at which the US dollar was traded at the close of the interbank market on Monday.
The anticipation of the loan had earlier in the month seen the rupee
appreciate by as much as Rs26. But the rupee then lost nearly Rs8.02 due to weak reserves and growing political uncertainty.
In the open market, the US dollar saw its value fall by as much as Rs5 with the greenback traded for as much as $223 on Tuesday morning. This was down from Rs228 for which it was being traded for on Monday.
But with the IMF putting the condition of a market-determined exchange rate, Pakistan should expect greater volatility in the value of the rupee and put pressure on policymakers to ensure the implementation of policies strictly adhering to the IMF program for any form of stability.-NNI