Global rating agency Fitch has said that Pakistan, which is in talks with the IMF to restart the $6.7 billion bailout package, will not depreciate the rupee further due to the easing of pressure.
According to Bloomberg, Fitch’s Hong Kong-based director Krisjanus Christensen said in an emailed response to a query that “we do not expect any further significant depreciation of the Pakistani rupee at this time.”
The Fitch director added that “while the rupee has been very stable in the past few months, pressure on SBI reserves remains, suggesting minimal intervention to stabilize the rupee”.
Pakistan, which is in negotiations to restart a $6.7 billion IMF bailout, is unlikely to devalue its currency again, according to Fitch https://t.co/9kR3gZruuD
— Bloomberg (@business) June 9, 2023
According to the report, the IMF says that it is working with the Pakistani authorities on other issues, including the integrity of the currency market, before revitalizing the bailout package. The rupee has lost 20 percent since the devaluation was announced by the authorities in January this year, making it the world’s worst-performing currency.
Domestic foreign exchange reserves have been stable at $4 billion since late February after a 50 percent decline in 12 months. At a time when billions of dollars in debt are coming due, the funds will be critical to support an oversupplied economy and prevent defaults, the report said.