Finance Ministry sets strategy to stabilize rupee

ISLAMABAD: The Ministry of Finance has set a new strategy to keep the rupee stable, citing sources, ARY News reported on Tuesday.

Sources said that the notices issued to eight major banks have helped to reduce the artificial hike in the rupee-dollar exchange rate.

“The cartelization of dollar by banks also being controlled,” according to the finance ministry sources.

“The banks were exercising pressure over the State Bank of Pakistan for opening the LCs of inflated value,” sources said. “Banks were demanding more dollars from the central bank for opening letters of credit of the traders.”

According to sources, the finance minister and the Governor State Bank have made the NOC compulsory for opening of the letters of credit (LCs).

“The ministry has directed the State Bank to devise “the dollar buying and selling policy,” sources said. The policy will fix the limits of bank margins in buying and selling of the greenback.

“The exchange companies could keep a margin of upto two rupees in buying and selling of dollars,” according to sources.

The government will keep the value of the dollar on the downside, despite decreased reserves and foreign payments, according to officials.