Rupee-dollar parity further shrunk to 33 paisas in the open currency market on Tuesday as the greenback was traded at Rs 105.05 for buying and Rs 105.20 for selling during the day.
“The demand of the greenback has decreased up to 70 per cent in last two months, while we have to surrender thousands of dollars to the banking system,” said Malik Bostan, former general secretary of Exchange Companies Association of Pakistan (ECAP).
An analyst of a brokerage house said that the greenback is stable in the Interbank market for last six months at Rs 104.60-Rs 104.70, while the rupee-dollar parity has been shrinking in the open currency market as its demand is continuously sliding throughout the country.
“We are looking the dollar stable in the interbank and open currency markets in future,” the analyst said. The dollar was being traded at around Rs 105.80 for buying and Rs 106.00 for selling on December 31, 2015.
“The dollar may trade below Rs 105 if the situation in future remained same as there is no demand of the US dollar except from Hajj or Umrah pilgrims,” Bostan said.
People are still selling dollars in the kerb market while the exchange companies are importing dollars from Dubai and other Middle East countries, said Bostan, who is also owner of Pakistan Currency Exchange.
For last two months, lackluster trading activity was witnessed in the local currency market owing to external inflows approved by the International Monetary Fund (IMF). Inflows in the market offset the repayment pressure against the 10-year Eurobond, the analyst said.
“The rupee/dollar parity stood at 30-35 paisas in the absence of buyers’ interest,” Bostan said. Sustained selling of the greenback by people and low demand from them backed up the rupee on the open market.
In the interbank market, the rupee inched up by one paisa on the buying but did not depict any change on the selling counter and traded at Rs 104.73 and Rs 104.75 in the first trading session.
Bostan said those who were sending dollar abroad illegally are out of the market owing to the Panama Leaks scandal in which the names of almost 200 Pakistani people have been disclosed.
The dollar is not being sold in Peshawar and Quetta for last 30 days that was considered to be the 2nd largest markets of greenback, he said.
Zafar Paracha, Secretary ECAP, said that after the decision of the governor State Bank of Pakistan (SBP), the exchange companies have sufficient dollar in the market, but there are no big buyers.
He said the black marketing of the greenback has totally stopped throughout the country because of the efforts of the central bank and Exchange Companies.
According to the secretary ECAP, the smuggling of dollar has almost ended and there is no case of dollar smuggling was reported in last 6 months.
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