Pakistan: Better management needed of foreign exchange reserves’

The dollar rose to Rs148 in the open market Thursday a day after Prime Minister Imran Khan took notice and told currency exchangers to lower the rate.

Malik Bostan, the president of the Forex Association of Pakistan, says what happened to the dollar today was exactly what was being predicted after the deal with IMF.

Since IMF has issued its press release [on the staff-level agreement with Pakistan], investors have taken the IMF conditions as negative, especially with regard to free float of the rupee against the dollar and increasing the interest rate, Bostan told Amber Shamsi, the host of SAMAA TV’s programme Sawaal.

This is what happens in a float market, he said, explaining that it was like the sea waves – it goes high and low depending on the conditions.

PM Imran Khan constituted a committee a day earlier to oversee currency fluctuations. But did this committee also aim to control the currency rates?

Bostan said that was not the purpose of the committee. He refuted the reports calling it ‘incorrect reporting’ by the media. He said he was present in the meeting the premier had held and had told the premier that Pakistan did not have a shortage of foreign exchange reserves, but just needed better management.

He explained the mechanism of demand and supply and how it would affect our economy and currency rate.