Amid an economic downturn, the Pakistani currency continues its decline against the US dollar, sustaining pressure for the third consecutive session on Wednesday, as reported by Dawn on Thursday.
The State Bank of Pakistan (SBP) noted an 11 paise increase in the value of the US dollar against the local currency, rising from PKR 278.29 to PKR 278.40 compared to the previous day, as reported by Dawn. Currency dealers expressed confusion regarding the recent upward trend in the dollar’s value, citing a lack of apparent reasons. They emphasized that the weaknesses in the exchange rate have been evident for years, with market dynamics influenced by factors such as the availability of dollars, SBP reserves, and potential future inflows.
As the Pakistani rupee continues its decline against the American dollar, this development coincides with visits from both a Saudi Arabian delegation and a team from the International Monetary Fund to Islamabad. While the Saudi delegation has pledged investment in Pakistan, the process might require some time as the kingdom is currently in the initial stages of identifying sectors and projects for future investments. Last year, the Saudi government announced a shift in its strategy, opting to support Pakistan through investments rather than loans, aid, or grants, as reported by Dawn.
Nevertheless, the Saudi government has already injected USD 2 billion into the State Bank’s account to bolster the SBP’s dwindling foreign exchange reserves, repeating a similar action taken previously. According to banking sources, the Saudi government had previously deposited USD 5 billion into the SBP account.