Pakistan rupee gains amid reported crackdown against US dollar smugglers
The raids led to some appreciation of the rupee against US dollar on Wednesday, according to Exchange Companies Association of Pakistan (ECAP) chairman Malik Muhammad Bostan.
In a press statement, Bostan said the action helped the domestic currency recovering by Re0.60 to Rs288 a US dollar during intra-day trading in the open market on Wednesday.
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'FIA [Federal Investigation Agency] teams, acting on secret intelligence, conducted large-scale raids today [Wednesday] against currency smugglers, due to which the dollar rate dropped in the open market and in the interbank market as well,' Bostan said.
In the inter-bank market, the domestic currency recovered by Rs0.21 – a higher gain in a day compared to recent weeks and months – and closed at Rs284.76/$ on Wednesday compared to Tuesday's close at Rs284.97/$, according to the State Bank of Pakistan (SBP).
This was relatively a bigger recovery in a day compared to usual fluctuation seen in the recent weeks, it was learnt.
Bostan said he had led a currency dealers' delegation to Director General of Counter‑Intelligence (DGC) General Faisal Naseer at the Inter-Services Intelligence of Pakistan (ISI) in Islamabad on Tuesday.
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When asked about the dollar rate rising in Pakistan, Bostan attributed the reason to currency smuggling to Iran and Afghanistan, according to ECAP statement.
'Due to higher black market rates, the supply of dollars is decreasing to legal currency dealers day-by-day,' he had said.
'On this, General Faisal Naseer immediately ordered law enforcement agencies to crack down on currency smugglers and arrest them. As a result of this action, the currency smuggler mafia has gone underground today [Wednesday].'
'If the FIA continues this crackdown against currency smugglers and hundi-hawala operators, in the coming days, the dollar rate could fall further — from Rs280/$ to Rs270/$ and even to Rs250/$,' Bostan was quoted as saying in the ECAP statement.
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