The State Bank of Pakistan (SBP) has discouraged interbank trade since the lack of US dollar banknotes has driven the Pakistani rupee to its lowest weekly level in over two decades.
The central bank has asked commercial lenders to manage import payment obligations from their inflows, such as exporter accruals and remittances. They also emphasized that if the bank still needs to borrow, it must acquire clearance from the monetary authorities.
According to other reports, certain banks are requesting authorization from the SBP and are supplying dollars at a premium, hence increasing rates for their customers.
On 20 July, banks transferred dollars to energy firms at rates of Rs. 238-242 per US dollar, almost eight percent over the official closing rate for the day.
The CEO of V.N. Lakhani & Co., a Karachi-based steel importer, commented on the effects of the impending currency crisis by stating that banks that formerly disbursed international payments within a day are now taking more than a week.
As Pakistan’s foreign-exchange reserves were inadequate to fund less than two months’ worth of imports, the rupee dropped by more than eight percent last week, the highest since 1998.
Murtaza Syed, the acting governor of the SBP, told Bloomberg that the government would be able to meet its financial needs as the International Monetary Fund (IMF) is preparing a rescue package.
“Our external financial requirements for the next twelve months are entirely fulfilled, as a result of our continuing IMF program,” he stated.
Pakistan has seen some of the worst bouts of dollar payment pressures in the history of the South Asian area owing to escalating energy costs and accompanying economic obstacles.