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Rupee tumbles to Rs222 in open market due to shortage of currency and growing political tug of war

ISLAMABAD: The value of US dollar in the open market again surged to 222 rupees on Monday afternoon in the wake of shortage of the foreign currency and growing political tug of war in the country between PTI and the coalition government.

Like open market, the dollar-rupee exchange rate in inter-bank also increased to 217.70 rupees on Monday from 216 rupees of previous day’s closing value.

According to currency dealers, from August 16, 2022, UAE government has made it compulsory for the air travellers to bring with them at least five thousand dirhams at the time of landing in UAE. This condition of UAE is leading to shortage of foreign currency in open market and boosting value of the greenback.

Interestingly, UAE has demanded dirhams not US dollars for landing in UAE, hence using this condition for boosting the value of US dollar in the inter-bank and open market seems illogical and the government must take notice of this trend of dollarisation in the country.

A couple of weeks ago, the government’s decisions to fulfill IMF conditions to secure $1.20 billion IMF tranche have led to a significant improvement in the value of rupee as the dollar-rupee exchange rate fell to 212 rupees in the inter-bank and 210 rupees in the open market.

However, during the last two days, the value of dollar is again being manipulated before the disbursement of IMF tranche of $1.20 billion by August 31. The executive board of the IMF is scheduled to give approval for the disbursement of the tranche on Aug 29 and within next two working days, the amount will be delivered to the State Bank of Pakistan.

When the government completed the requirements of the IMF, the capital market experts were talking about decline in the value of US dollar to 190 rupees in the inter-bank and open market. But market forces have become active to manipulate dollar-rupee exchange rate six days ahead of the IMF board meeting to mint money.

Javed Mahmood
Written By

I am an experienced writer, analyst, and author. My exposure in English journalism spans more than 28 years. In the past, I have been working with daily The Muslim (Lahore Bureau), daily Business Recorder (Lahore/Islamabad Bureaus), Daily Times, Islamabad, daily The Nation (Lahore and Karachi). With daily The Nation, I have served as Resident Editor, Karachi. Since 2009, I have been working as a Freelance Writer/Editor for American organizations.

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