ISLAMABAD: Pakistan financial authorities are unlikely to let the national currency slide again as pressure on the rupee has eased, Bloomberg reported this week, citing international credit agency Fitch Ratings.
The Pakistani rupee has lost its value by more than 30 percent since last June, while officials devalued the currency in January, making it one of the worst performers worldwide.
The depreciation of the national currency, coupled with global supply chain constraints and other economic woes, fueled record inflation and forced the government to ban imports of luxury items to prevent dollar outflows.
However, the foreign exchange reserves held by the Pakistani central bank have remained stable around $4 billion since late February, after depleting more than 50 percent over the past one year.
“We currently do not expect a large further devaluation of the Pakistan rupee,” Krisjanis Krustins, a Hong Kong-based director at Fitch, said in an emailed response to the Bloomberg news agency this week.
“The currency has been very stable over the past few months, (and) pressure on the reserves of the State Bank of Pakistan has also been contained, which suggests minimal interventions to support the currency.”
Pakistan has been in talks with the International Monetary Fund (IMF) for the revival of its $6.5 billion bailout program, stalled since November.
The program runs out this month with about $2.5 billion in funds yet to be released as the South Asian country struggles to strike an agreement with the lender, amid record inflation, fiscal imbalances and with foreign reserves barely enough for a month of imports.
The IMF recently said that it was working with Pakistani authorities to fix its currency market and other issues before resuming the bailout package.
On Friday, Prime Minister Shehbaz Sharif hoped the IMF would resume the stalled bailout program as the country had already met all prior conditions set by the global lender despite economic hardships.
“The ninth review will be complete soon,” the prime minister said during his televised address with the federal cabinet.
