KARACHI: The US dollar after the Paris attacks further strengthened against all major currencies including Pakistani rupee which was traded at Rs107 on Tuesday.
The currency dealers’ associations did try to stand by their promised price but the greenback pushed hard and traded in the range of Rs106.80-107.
The Nov 13 attacks on French capital shattered the confidence on the euro which started falling against the US dollar.
Currency experts said the European Union is already under pressure due to influx of migrants from Syria and Afghanistan.
In the aftermath of Paris attacks the euro started losing value against the dollar which attracted investments on large scale.
The options for global investors have shrunken vastly after plunging of oil prices in the international market. The bedrock oil prices eradicated speculations from its market leaving trillions of dollars having no option. Investors parked money in dollars account on large scale.
In the local market, the euro fell to Rs112.50 on Tuesday while the price was Rs115-50 before the Paris attacks. The British pound has also lost against dollar after the attack but size of loss was not significant.
This fall in euro prices strengthened the dollar in Pakistani market and it was traded as high as Rs107. The exchange companies were not providing big amount while the large exchange companies said they were not selling at this high rate.
“The US dollar has been trading illegally at Rs106.80.90 for last many days without any documentation,” said Zaffar Paracha, General Secretary Exchange Companies Association of Pakistan.
He said the illegal trading means smuggling of dollars to Afghanistan and Iran and the buyers pay higher rates for not providing required documents. The State Bank bounds all currency traders to register the buyers with national identity card numbers and the purpose of buying dollars.
For the last two weeks, the State Bank has been supplying dollars to the exchange companies to meet the demand of the open market.
“All most all global currencies showed weakness in the wake of the Paris attacks particularly euro. It has an impact on Pakistan also that is whey dollar appreciated against the local currency,” said Anwar Jamal, a currency dealer.
The dollar remained stable in the inter-bank market, however.
Published in Dawn, November 25th, 2015
