Pakistan News

Currency dealers quash panic rumours

Currency dealers quash panic rumours

KARACHI: Though dollar gained a little against the local currency on Tuesday, inching towards Rs102.85 amid reports of its shortage in some parts of the country, currency dealers said there was no panic in the market.

“There is no shortage of dollars in the market. The rates have slightly increased because of higher demand,” said Malik Bostan, President, Forex Association of Pakistan.

The money-changers at exchange companies told Dawn that these deals for $2,000-5,000 were easily available in the market, but bigger amounts were difficult to manage. Bostan said he was ready to provide any amount required on market rate.

The dollar fluctuated to touch Rs103 on Monday for a short span, but slipped back to close at Rs102.70.

The secretary-general of Exchange Companies Association of Pakistan Zafar Paracha also denied any shortage in the market.

“This is a false impression that the currency market came under pressure because of evolving situation in the Gulf,” said Paracha.

The market was rife with the speculations that insurgency in Yemen and involvement of Saudi Arabia could hamper inflow of remittances to Pakistan. However, there was no apparent impact of these speculations.

“There was no shortage of dollars,” Paracha said, adding that the dollar has been gaining slowly against the local currency for the last few months.

The dollar weakened in the inter-bank market supporting the exchange companies’ claims.

The dollar was traded at a maximum of Rs101.73 on Tuesday while the price was Rs101.88 on Monday.

“We don’t see any panic. In fact, the demand for dollar dropped during this week. Large banks, like National Bank and Habib Bank, are out of the market which sharply reduced dollar demand, causing a decline in prices,” said Atif Ahmed, a currency dealer in the inter-bank market.

Some experts commenting on currency movements said the dollar has been continuously gaining against top world currencies for the last six months which is also one of reason for gradual appreciation of dollar against the rupee.

“In the last six months, the euro fell to Rs106 from Rs146 and the British pound to Rs150 from Rs176, which reflects the weakness of these currencies as well as strength of dollar,” said Anwar Jamal, a currency expert and dealer.

Published in Dawn, April 15th, 2015

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