KARACHI: In the last three days the US dollar kept appreciating against the rupee and was trading above Rs127 in the open market.

The market saw a panic-like situation on Saturday after a private TV channel ran a news that the International Monetary Fund (IMF) has asked to depreciate the rupee up to Rs150 against the dollar and the government has agreed to bring it up to Rs135.

“This highly unauthentic report upset the market as people started buying whereas sellers disappeared. The open market business remains slow on Saturdays compared to normal working days, but this panic flushed out dollars from the market,” said President Forex Association of Pakistan Malik Bostan.

The dollar was trading as high as Rs127 gaining Rs1.4 (1.1 per cent) in the last three days. It rose 70-80 paisa alone on Saturday.

Currency experts said that in the presence of the IMF team in Pakistan, this sudden jump in dollar price could hurt the country’s stance on stable exchange rate. They said the IMF considers open market rate more reliable since the interbank rates are regarded as semi-regulated rates by the State Bank.

Prior to the general elections, the dollar in the open market traded as high as Rs134, but for a short while. It fell as low as Rs113 after the elections and gradually started picking up to surpass the inter-bank rates which remained higher than the open market.

With the restoration of dollar supply on Monday, the open market could see a fall in the dollar rates, said the currency dealers, adding that the government should also make it clear that if a commitment with the IMF regarding the exchange rate has been made.

Published in Dawn, September 30th, 2018