KARACHI: It seems that the euphoria over the International Monetary Fund (IMF) Stand-By Arrangement of $3 billion fizzled out as the dollar appreciated despite a significant improvement in inflows.

The State Bank of Pakistan (SBP) reported the closing price of the dollar on Friday at Rs277.59 in the interbank, showing an appreciation of Rs1.13 from the previous day’s closing.

The inflows from the IMF, Saudi Arabia and the United Arab Emirates had changed the sentiments during the early days of this week but the dollar’s appreciation on Friday indicated return of dollar domination.

The foreign exchange reserves of the SBP increased by $4.2bn due to new inflows, making the total reserves of the country as $8.7bn.

The improvement, which provided strength to the local currency for few days, could not last even a week. The government’s commitment with the IMF for free exchange rate was felt in the market.

In the open market, the dollar traded Rs1.50 higher than the previous day. Exchange companies reported that the dollar closed at Rs281, but they maintained that the trading was thin due to lack of demand.

Published in Dawn, July 15th, 2023