Dollar Price Hits an All Time High of Rs. 166
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Dollar Price Hits an All Time High of Rs. 166

PKR {Pakistani Rupee} fell sharply in today’s early trading as the dollar traded at Rs. 166 in the interbank.

According to the report, it was basically being quoted at 165.50/166. The PKR hit an all-time low of 164.05 against the US dollar on 27th June 2019.

The PKR continued its slide today traded at an all-time high of 166.00 against United States Dollar, trading past 164.50, on June 27 last year.  

Eman Khan said that “Dollar liquidity is thin, which is really squeezing the Rupee. We have a support region at 166.75/$ and may see reasonable supply in that region,”

To be honest yet we haven’t seen any kind of intervention by the Central Bank in easing the situation so far.

Eman Khan further stated that the government of Pakistan is negotiating with multilateral parties for $3. 7 billion COVID-19 relief packages.

In case if it is done correctly, it may be possible that Pakistan may have a soft landing once the crisis dies down – and that’s a long time from now.

The managing director at Khadim Ali Shah Bukhari Securities, Mr. A.A.H Soomro stated that this was bound to happen.  

Furthermore, he added that he is a choice State Bank of Pakistan and the government has willingly taken post aggressive monetary easing this week.

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The imported inflation could be negated by falling energy/food prices until supply-shocks kick-in, State Bank of Pakistan could have to intervene to prevent the rout, and Foreign exchange has been the only functioning market in Pakistan this month until the 150 bps cut.

A.A.H Soomro emphasized that we can’t afford to let the currency plunge any further, the current massive outflow of hot money has put some pressure on the exchange rate, which pushed the dollar rate to Rs. 166 in the interbank market.

According to rumors, foreign investors were upset about the sudden decision of policy rate change by the central bank and resorted to panic selling of T-Bills {Treasury Bills}.

One of the experts added that individuals are now hoarding dollars, after seeing the rise against the PKR, to take some gains for themselves.

According to brand new data released by State Bank of Pakistan on Wednesday,

“cumulatively foreign investors divested some $1.873 billion from their investments in the government securities – Market Treasury Bills (T-Bills) and Pakistan Investment Bonds (PIBS) – during 1st July 2019 to March 23, 2020 period. With $3.492 billion inflows and $1.873 billion outflows, net foreign investment in the government’s debt instruments, including T-Bills and PIBs stand at $1.619 billion during FY20.”

The SBP lowered policy rate by a cumulative 225 basis points to 11 percent in two monetary policy announcement in a week.

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