‘Erratic’ rupee fills IMF with concern

The frequent rupee depreciations against the US dollar amid a supply-demand mismatch is a serious concern for the International Monetary Fund (IMF), sources in the financial sector told Dawn on Thursday. The sources said that the continued devaluation of PKR has changed the view about the exchange rate stability which emerged in the wake of a crackdown launched in early September against the illegal currency business and dollar smuggling. “The IMF has concerns about the frequent devaluation of PKR and found the current exchange rate unreal,” said a high-placed source in the financial sector, adding that the second tranche of $710 million under the $3bn Standby Arrangement (SBA) would be released with some more strings. The nine-month SBA will end in March 2024. However, a senior banker and currency expert said the inflows of export proceeds could increase this month. “In the next two weeks fresh export proceeds could land into the market,” said Atif Ahmed, a senior banker and currency dealer in the banking market. He said the fresh arrival of export proceeds would depend upon the market situation which is so far not conducive for sellers.