Dollar rate in Pakistan drops, but for how long?

Pakistan’s main worry has always been the dollar rate. The rise and fall in the value of the US dollar has a significant impact on Pakistan’s economy, as it has a significant impact on Pakistan’s exports and imports.

In modern times, the economy is a source of power for a state, hence it is critical to maintain it stable. Unfortunately, Pakistan’s economy has been suffering recently as a result of corruption, political instability, pandemic, and floods.

Amid all the terrible news, the reduction in the value of the dollar is a ray of optimism for Pakistan, but the question is still for how long?

The economic growth of Pakistan is dependent on the rate of the dollar. Studies show that the dollar once dropped in 2020, from 168 PKR to 152 PKR. After this drop, the stock market was seen as motivated to invest.

source: tradingeconomics.com

Moreover, after that, in 2022, the rate of the US dollar again dropped from around 152 PKR to 138 PKR. This drop uplifted the consumers and industries of imports and it also was a good sign for the economy of Pakistan.

A decrease in the dollar rate will lead to less money for the imports and hence, less price for the consumers in Pakistan. This is how inflation is controlled.

Furthermore, in 2023, again drop in the US dollar is observed. Now keeping this drop stable consistently is not an easy task for a state like Pakistan where the economy is in such a bad condition.

Yet not to lose hope there are some measures, the government of Pakistan is taking like the State Bank of Pakistan is working on its policies and strategies to strengthen the foreign currency.

To summarize, the decline in the dollar rate is a sign of hope for Pakistan’s economy; nevertheless, it is crucial to remember that it is not only in the hands of one state to maintain the dollar rate steady or the drop stable, but it also takes long-term policies and planning.

Pakistan, on the other hand, may regulate its current economic situation by reducing its reliance on imports and raising its exports.

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