KARACHI: September 7, 2022: US dollar (USD0 continued its bullish trend against the rupee in both interbank and open market in Pakistan on Wednesday.
USD appreciated by another Rs 1.45 against the local currency and pegged at Rs 223.20 in interbank. Its value was Rs 221.75 in interbank at the closing of the bank’s working time on Tuesday. In open market, USD is also gained Rs 1 in the first half of trading session of Wednesday. Its value jumped up to Rs 231 on Wednesday against the local unit from Rs 230 of the last day.
Both interbank and open market and interbank are showing a difference of Rs7.80. Such a huge difference in USD value in interbank and open market is suggestive of poor or even non-existent regulatory framework. Had the regulator , State Bank of Pakistan (SBP) done work on its part and put in place dollar mafia would not have taken undue benefit to make windfall profit on USD
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The currency market is volatile since long and dollar mafia is taking full advantage of SBP’s criminal silence. In July, the dollar mafia had taken USD value to all time high against the rupee. The local currency was losing its value on day- to- day basis, but SBP remained total oblivion to the free fall of the rupee.
Interestingly, the rupee is under pressure due to SBP’s inaction to stop distortions in the currency market . Even an inflow of $ 1.16 from the International Monetary Fund (IMF) has not survived the rupee from artificial pressure.
Finance minister , Miftah Ismail, has repeatedly acknowledged time and again that USD has been over appreciated in the currency market and its actual value ranges between Rs 180 and Rs 185, but he seemed helpless in taking any action to stop the dollar mafia to create artificial appreciation of the rupee.
Miftah Ismail is under criticism from his own party for failing in taking timely decisions to check artificial over appreciation of USD. Former Finance minister , Ishaq Dar, is also wailing over non-professional approach of Miftah Ismail that he strongly believe was a major factor in letting the dollar mafia make billions rather trillion through over valuation of the local currency.
SBP is mere a spectator in the whole dirty game. It has failed to take any regulatory action against those who were artificially overvaluing USD and causing huge rather irreparable loss to the national economy.
Devaluation of the local currency has resulted in addition of trillions in Pakistan’s debt. Its SBP whose shady polices have pushed Pakistan into a debt trap and now this poor nation of 220 million people is paying its price in the form of unbearable and rather killing inflation and subsequent price-hike.