It's Rs 122 now - Dollar falls by Rs5 against Pakistani rupee

KARACHI: Pakistani rupee on Monday surged by 4.3 percent to 122.5 per dollar on Monday, following domestic media reports over the weekend that China had agreed to provide $2 billion in loans.

Monday brought the first significant strengthening in years for the rupee, which has weakened more than 20 percent since December after four separate devaluations by the central bank.

Karachi-based brokerage Intermarket Securities said weekend publication of full results of the July 25 election may have also helped sentiment, as did media reports of possible inflows from Saudi Arabia.

Officials from Imran Khan’s Pakistan Tehreek-e-Insaf (PTI) said they were in talks with independents and at least one other political party to form a coalition government.

But the rupee’s advance might be short-lived, given Pakistan’s economic problems, analysts said.

“Short-term flows aside, it is difficult to see the (rupee) sustaining its pullback for long,” Intermarket Securities said in a note.

Many analysts expect Pakistan to turn to the International Monetary Fund for a bailout, which is expected to be in excess of $10 billion, according to local media reports.