Dollar Rate in Pakistan Hits Rs285.80, Experts Warn
The ongoing dollar shortage and exchange rate volatility have significant implications for Pakistan's economy, including potential inflationary pressures and political instability, highlighting the need for effective policy measures to address the issue and stabilize the rupee.
The US dollar is buying at Rs284.51 and selling at Rs285.80, according to the open market rates released by the Exchange Companies Association of Pakistan, as a growing dollar shortage in Pakistan's interbank market leads to exchange rate volatility.
The Pakistani rupee is buying at Rs283.80 and selling at Rs284.00 in the interbank market, with the shortage being exacerbated by recent geopolitical shocks, including the Iran-Israel conflict and a brief border clash between Pakistan and India. As a result, the rupee has weakened against major currencies, with importers being quoted at Rs284.25-284.50 per dollar, while the open market rate hovers around Rs285.70.
Exporters are holding back on converting their proceeds, further tightening dollar supply, and the State Bank of Pakistan is actively purchasing dollars from the market to meet reserve targets ahead of the next IMF review. Experts expect the rupee to stabilise near Rs285 in the coming month, but warn that significant depreciation could have inflationary and political implications.
The dollar rate in Pakistan is likely to remain volatile in the coming days, with the country's economic stability and geopolitical tensions playing a crucial role in determining the exchange rate. As the situation continues to unfold, it is essential for policymakers and stakeholders to closely monitor the developments and take necessary measures to mitigate the impact of the dollar shortage on the economy.