In spite of the inflows, the Dollar gained value against the Pak Rupee as the importers were buying the greenback and some large payments were made. - File photo

KARACHI: Remittances increased by 25 to 30 per cent during Ramazan compared to regular average monthly inflows, bankers and currency dealers said.

Bankers said the remittances could be higher by 25 to 30 per cent, while the amount might be in the range of 1.25 to 1.3 billion dollars during Ramazan.

No final figures about inflows were available and the calculation for the entire month would take time but the earlier estimates of bankers and currency dealers speak of higher inflows.

“This is difficult to assess at this stage while we have no consolidated figures about remittances but the trend of higher inflows during the month of Ramazan could accumulate up to 25 per cent more than the average monthly inflows,” said Atif Ahmed, an expert and currency dealer in inter-bank market.

Bankers said that this year more inflows were received for the charity organisations, while the amount of Zakat was also higher. They believe that higher Zakat was due to floods in the country.

The victims of the previous year floods could not be rehabilitated, while the fresh floods, particularly in Sindh have added to their miseries.

The currency dealers in open market estimate that the inflows during Ramazan were higher by 30 per cent. They said day-to -day dealing was enough to judge the rate of inflows of foreign money in the country.

“Millions of Pakistanis are living abroad, and several hundred thousands people used to celebrate Eid in Pakistan with their families that bring huge inflows of foreign currencies,” said Anwar Jamal, a dealer in open currency market.

He said inflows other than dollar were also very high during the month. Currencies of the UAE, Saudi Arabia and European Union were much more than average monthly inflows.

However, it was difficult for the currency dealers to understand that despite higher inflows dollar gained more against the rupee.

Bankers said the tight market was due to demand from importers and mainly from oil importers.

The dollar has been losing against major international currencies, particularly after the US downgrade by the rating agency Standard and Poor's.

But the situation in Pakistan was reverse for the greenback. During the last days of Ramazan the dollar traded at Rs87.10 in the inter-bank market, which was a record. In the open market the dollar traded at a lower price of Rs86.88 and Rs86.92.

The currency dealers in the inter-bank market said the dollar demand remained high during Ramazan despite higher inflows.

This was so as the importers were buying the greenback and some large payments were made.

However, they were not clear why oil payments were higher, while the oil prices remained at the level of previous year.

Market experts said the reason for higher demand of dollar was due to fear of no inflows from IMF, ADB and the World Bank.

The fear developed out of souring relations with the United States.

The IMF refused to pay further on account of Stand-by Agreement, while the repayment of over $7 billion IMF loan will start from next calendar year.