Pak-rupee closes at Rs 144 against a dollar

KARACHI: The greenback hit all-time high at Rs 146.25 in the open currency market, but the sources claimed that it settled down at Rs 144.

The dollar gained all-time high in Pakistan after an increase of Rs 2.25 in the open currency market following Pakistan’s agreement with the International Monetary Fund (IMF) securing a $6 billion bailout on Sunday.

Pakistani stocks fell as investors and analysts expressed doubt over the reported conditions of the deal. “The investors have taken the IMF conditions as negative, especially with regard to free float of the rupee against the dollar and increasing the interest rate,” Yawar Uz-Zaman, head of Research at Shajar Capital, a brokerage house in Karachi told AFP.

For more than a year now Pakistan has struggled to stave off a looming balance-of-payments crisis while its economy teeters due to low growth, soaring inflation, and mounting debt.

Some analysts suggested $6 billion would not be enough to pull the country back from the brink, with Zaman describing it as “insufficient”.

Mohammad Sohail, CEO of Karachi-based brokerage house Topline Securities, said they believe Pakistan’s annual foreign payments could be as high as $14 billion. If Khan’s government can secure more funding from donors including China and Saudi Arabia, from whom Khan has already raised billions, then it could be sufficient, he said. “If not, it would not be enough for the foreign payments.”

Salman Ahmed, head of institutional sales at Aba Habib Ali, a brokerage house in Karachi, said the amount was less important than the fact a deal had been struck at all.

“This will give the government a breathing space, and now it can look around for other sources of financing foreign debts,” he said.