Finance Minister Miftah Ismail has said that the pressure on the rupee, which has pushed the local currency to drop as much as 17 per cent against dollar in July alone, will ease within the next two weeks.
The finance minister was responding to a question by a reporter during a press conference in Islamabad on Sunday along with Prime Minister’s Coordinator on Economy, Bilal Azhar Kayani.
“You are correct that after the August 17 [Punjab by-] polls, the dollar has got out of control and appreciated. I truly believe — even though I don’t speculate on the currency market — but I think that the true value of the rupee is far greater than this,” he added.
He further added that the pressure on the local currency was also due to payments worth billions which the government had to make this month and the previous month.
“But let me be honest, no one knows the market. I can believe the fundamentals are in my favour but speculation, sentiments also play a role,” Miftah said.
Speaking further, the finance minister vowed to make all possible efforts to ensure that dollars coming into the country on a daily basis would be more than those leaving and also promised to rein in the current account deficit.
In this regard, he said that the government is currently trying to reduce the trade deficit to stabilize the rupee against the dollar. He said that for the last three months, efforts have been made to reduce imports and the results are now coming out. “Imports in this month of July reached $5 billion dollars, which was 7.7 billion dollars in the previous month of June 2022.”
“Thus, compared to the previous month, imports decreased by $2.7 billion dollars during the month of July 2022,” he added.
The minister assured that these economic measures, along with the continued ban on the import of mobile phones, vehicles and home appliances, will stabilise the value of the rupee against the dollar.
“All of these measures aimed to reduce the trade deficit in the country’s economy, which will bring economic stability to the country,” he said.
Speaking further, the finance minister said: “We are not working on the rate of inflation but on getting the country out of economic challenges. Currently, the government is fully focused on increasing domestic exports, which will be given full attention in the next three months. We are trying our level best to build the economy in the right direction in which we are getting success to a great extent.”
Moreover, the finance minister also remarked that one last remaining condition of the International Monetary Fund (IMF) to release the loan tranche would be fulfilled by Monday morning, however, he did not mention which one.
Earlier on Friday, the rupee gained 57 paisa or 0.24pc to close at 239.37 after a two-week losing streak against the dollar, taking its fall for 2022 to 35pc. It has depreciated around 5pc this week.
Foreign exchange reserves held by the State Bank of Pakistan have fallen by $7.811 billion since February to $8.575 billion in July, enough to pay around six weeks of imports.
