The Pakistani rupee gained about 1% versus the US dollar in the first hours of intra-day trade on Thursday after the International Monetary Fund (IMF) Executive Board approved Pakistan’s new Stand-By Arrangement and the UAE deposited $1 billion.
At 11:30 a.m., the rupee was trading at 275.11, up Rs2.37 in the interbank market.
The Pakistani rupee surged more on Wednesday, rising 0.39% to 277.48 in the interbank market.
In a significant milestone, the IMF’s Executive Board approved a $3 billion Stand-By Arrangement (SBA) for Pakistan on Wednesday. The Board’s approval permits for the immediate payment of SDR894 million (about US$1.2 billion).
According to the Fund, Pakistan’s economic reform strategy intends to assist immediate measures to stabilise the economy and protect against shocks, while also making room for social and development spending to benefit the people of Pakistan.
Separately, Pakistan received a $1 billion payment from the United Arab Emirates (UAE), according to Finance Minister Ishaq Dar on Wednesday.
In a televised speech on Wednesday, the finance minister stated that the friendly country had recently made a pledge to provide additional $1 billion deposits to Pakistan.
Internationally, the US dollar fell further in Asia on Thursday, as traders interpreted surprisingly weak US inflation as a sign that US interest rate hikes will be completed by the end of the month.
Overnight, the dollar experienced its worst session in five months, losing more than 1% against the euro to its lowest level in more than a year, with even greater losses elsewhere.
The US dollar index declined slightly to 100.47, its lowest level since April 20, 2022.
Oil prices, a major measure of currency parity, rose on Thursday after US inflation and economic statistics raised hopes that the Federal Reserve will rise interest rates less frequently in the future, while Chinese trade data showed June monthly oil imports were the second-highest on record.
