Description:

To preserve the availability of dollars in the nation, the State Bank of Pakistan (SBP) has given exchange operators permission to export foreign currencies other than the US dollar.

The exchange companies were instructed by the central bank to deposit US dollars into their foreign currency accounts held with Pakistani banks.

The SBP was notified in a statement that exchange companies would be permitted to export US dollars on a cumulative basis through a security company, but the firms had to make sure there would be enough money to meet demand. The enterprises were further instructed by the central bank to ensure that the export revenues would arrive in their accounts within three days.

Additionally, the exchange companies have been instructed to return 100% of the foreign currency they got on the same day"s export of the US dollar from the interbank market. The facilities must be available through September 30.

According to experts, the choice would increase the market"s supply of dollars.

It is important to note that Pakistan has been struggling with difficulties such as shrinking foreign reserves, a weakening currency, and growing fiscal and current account problems. Due to an increase in debt payments and a lack of external financing in August, foreign reserves decreased by 6.6 percent to $7.83 billion. SBP had estimated the reserves at $8.385 billion a week earlier.

According to the central bank, debt repayments should slow down over the following three weeks of this month. In reality, the first week of August saw the majority of the debt servicing, according to the statement.

According to experts, the recent fall in reserves was brought on by a lack of foreign finance, and things would get better once the International Monetary Fund delivered its $1.17 billion contribution (IMF). On August 29, IMF will decide in a definitive manner.