Malik Bostan, the chairman of the Exchange Companies Association of Pakistan (ECAP), declared on Tuesday that starting on Wednesday, exchange companies will no longer place a limit on the open market price of the US dollar.
According to a statement from Bostan, the association met with Dr. Inayat Hussain, Deputy Governor of the State Bank of Pakistan (SBP), and informed him of the decision to lift the exchange rate cap.
Exchange companies have announced they will remove the cap on the exchange rate from tomorrow. Let's see where the dollar goes after that.
— Khurram Husain (@KhurramHusain) January 24, 2023
He said that the association had taken the decision to put a cap on the exchange rate last year but the situation has changed now. He said that the step has proved to be negative for the exchange companies.
He also mentioned that the removal of the cap on the exchange rate will put an end to the black market trade of the US Dollar.
The Pakistani Rupee (PKR) continued its unprecedented fall against the US Dollar (USD) today for the 25th straight session and reported losses in the interbank market. The local currency lost Rs. 0.25 against the greenback at the close of today’s session. The PKR depreciated by 0.11 percent against the USD and closed at Rs. 230.40.
It is important to note that while the rate of exchange of dollars on the black market has increased even further recently, the difference between the interbank rate and the open market rate has recently been bigger than typical.