US Dollar exchange rate is again changing in Pakistan. The government blames the PTI and PAT marches. The increase in US dollar means that all imported food products, fuel and electricity will become expensive, which means inflation will increase.
But the US dollar rate in Pakistan is controlled by the government. Since Pakistan does not follow the gold standard, therefore the US dollar exchange rate is based on the quantity of Pakistani rupees available in the market.
So if the government (State Bank) releases Pakistan rupees into the market, the dollar exchange rate will go up. And if the State Bank buys all the rupees from the market, reducing their circulation, this will reduce the US dollar rate.
ENGR SHAHRYAR KHAN BASEER
Peshawar