With reports that some dominant exporter groups are trying to create instability in the market by buying US dollars in large quantities, the exchange rate for US dollar in the interbank market has appreciated by Rs 2.10, reaching a 17-month high of Rs 104.10.
Experts are of the view that the decrease in value of rupee under the current circumstances will cause inflation in the country.
Currency dealers, however, emphasised that Haj pilgrims were the biggest buyers of foreign currencies, including Saudi riyals and US dollars.
The State Bank of Pakistan (SCP) has recently allowed currency dealers to bring dollars from Dubai directly in their accounts in Pakistan instead of surrendering dollars to a bank and then getting them within a week’s time. The step was taken on demand of currency dealers and for speedy supply of dollars in the open market.
Since maximum Saudi riyals are being consumed by pilgrims, less foreign currencies are available to sell in Dubai for buying and remitting dollars into the country.
Since the imposition of withholding tax (WHT) on banking transactions, another group of buyers appeared in the open market. Traders protesting against WHT are buying dollars, making payments through it and saving it in their bank lockers.
