The US dollar fell to its lowest level in the last seven weeks in the open market trade on Tuesday.
The greenback was trading at Rs138.8 in the evening, down 20 paisas from the previous day’s close. It remained stable at or above Rs139 since December 5 when a dollar was worth Rs138.6.
The dollar had kept buyers and sellers on their toes last year because of volatility in its prices and hit its all-time closing high of Rs140.3 in November. Last year, the dollar appreciated 27% against the rupee, witnessing two of its biggest single day jumps in a short span of one-and-a-half months.
Experts attribute the rise in dollar rates to our depleting foreign exchange reserves, which fell below $7 billion last month. This level is not sustainable beyond two months of import payments. The shortage of dollars had kept the rupee under pressure for most of 2018.
However, the government was able to secure back-to-back aid packages from Saudi Arabia and UAE during last year’s visits of Prime Minister Imran Khan to these friendly countries. As Pakistan started receiving these loans, the dollar mostly traded above Rs139. Just last week, Pakistan received $1 billion each from the Saudi government and UAE, which pushed its foreign exchange reserves to a five-month high of $8.8 billion.