KARACHI – Pakistani rupee made gains in early trading sessions on Thursday a day after the government and the International Monetary Fund (IMF) reached a staff-level agreement for release of second loan tranche of $700 million.
The local currency went up by Rs1.81 against the greenback to reach Rs286.35 with experts believe that rupee would register more gains.
A day earlier, the dollar closed at Rs288.14 after appreciating by 0.09 percent.
The IMF’s technical staff had initiated the first evaluation of the short-term loan agreement on Nov 2, which concluded on Nov 10.
In a statement, the Fund said that a team led by Nathan Porter was in Islamabad to hold discussions on the first review of the Stand-By Arrangement.
“The IMF team has reached a staff-level agreement with the Pakistani authorities on the first review of their stabilisation programme supported by the IMF’s $3 billion SBA,” Porter said.
“The agreement is subject to approval of the IMF’s Executive Board. Upon approval, around $700m will become available bringing total disbursements under the programme to almost $1.9bn,” he said.
“Anchored by the stabilisation policies under the SBA, a nascent recovery is underway, buoyed by international partners’ support and signs of improved confidence,” Porter said.
He said that the steadfast execution of the FY24 budget, continued adjustment of energy prices, and renewed flows into the foreign exchange market had lessened fiscal and external pressures.
“Inflation is expected to decline over the coming months amid receding supply constraints and modest demand. However, Pakistan remains susceptible to significant external risks, including the intensification of geopolitical tensions, resurgent commodity prices, and the further tightening in global financial conditions. Efforts to build resilience need to continue,” Porter said.
The IMF mission chief said that strengthening macroeconomic sustainability and laying the conditions for balanced growth were key priorities under the SBA.
