Speculators behind rupee free fall, says Shaukat Tarin

KARACHI: While the rupee plummeted to a new all-time low of Rs176.50 against the US dollar in the interbank market in early trade today, Adviser to the Prime Minister on Finance Shaukat Tarin blamed speculators (satta mafia) for devaluation of the local currency.

Speaking to the media, Tarin said, “the real effective exchange rate of the dollar, experts say, should be around Rs165-67.” If the greenback is trading as high as Rs176 in the interbank market, then the rupee is undervalued by almost Rs10, he added.

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He said speculators are behind the current devaluation of the rupee. They will be hit hard once the rupee starts appreciating against the dollar, he warned. The adviser said the government is taking steps to bring the dollar down to its actual rate.

To a question about the government’s plan to introduce the mini-budget, he said taxes won’t be raised but some exemptions, as agreed with the International Monetary Fund (IMF), would be withdrawn.

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Earlier, Shaukat Tarin had said the IMF has demanded that Pakistan fulfill five major conditions before the release of the tranche. “They include elimination of tax amnesty and autonomy of the State Bank of Pakistan (SBP),” he said adding that another demand of hiking fuel prices has already been fulfilled.