Why Dollar Is Increasing Day By Day in Pakistan & India?
Currency dealers in the interbank market said the dollar was traded as high as Rs161.70 and closed at Rs161.70 after a gain of about 97 paisas yesterday.

However, in the second session — which was for (yesterday's value) — it rose to Rs162.75, mounting further pressure on the local currency.

The dollar had hit a peak on 27 March when it was traded at Rs169.90 in the interbank. The exchange rate remained under pressure, particularly after the coronavirus outbreak. The country witnessed an outflow of over $3.5 billion from domestic bonds while the inflow of foreign direct investment also fell month-on-month in April and May 2020. That was the highest ever spike in the Dollar's rate.

Dollar Rates Today In Pakistan & India on 23rd Feb 2021:

As you know the rates of the Dollar increasing day by day, but during these days rates are fluctuating. As of today's rate of Dollar in Pakistan is 159.05 and The rate of the Dollar in India

is 72.421 Indian rupees.
The latest increase in dollar value has hiked the debt burden on the country by billions of rupees. The price is set minute by minute by traders and investors who make bets on which way the market prices of a currency are headed. But there are more powerful, longer-term forces at work driving those bets.
Will the rupee get stronger in 2021?

The US Dollar continued its impressive run against the Pakistani Rupee in the currency market, after the USD value increased by Rs159.05. The value of the US Dollar has been rising against PKR.

Foreign investors’ withdrawal of domestic loans and short-term investments from stock markets led to a decline in the value of the rupee. One more reason which is resulting in this rise in the price of the dollar is import orders. When the interest rate is cut, importers place orders and buy dollars, which also increases the demand for the foreign currency and it becomes expensive. Under the current economic policy of the government, the Pakistani rupee will hover around 150 in 2021.

It may shade under 150 for some time but it will be stable around this figure for the year 2021. But I don’t take it as a sign of economic stability though.

For me, the first real sign of economic revival will be a decreasing inflation rate which is around 13% nowadays.

What Is The Effect Of CoronaVirus On Increasing Rates Of Dollar?
The dollar gained against the rupee after the coronavirus outbreak in March 2020, but the country’s foreign exchange reserves were boosted at the end of the last quarter of FY20. Coronavirus created a great fluctuation in the graph of the Dollar. Despite the country’s reserves now nearing a three-year high, the dollar is still gaining. Currency dealers said the imports have started rising which created a demand for the greenback.

How can we overcome the Dollar?
The banker said the importers were also in the queue to buy dollars which increased both the demand and the prices. They said the NBP was probably purchasing for some large payments that may not be on Monday.
According to my point of view, rates won't low until we start importing & exporting from other countries. As you know due to Covid-19, many

businesses are closed right now and there's a lot of work to do for us to recreate the hype in our industries. And I think that's the major issue why the dollar rate increasing day by day.

However, currency dealers also believe that import was increasing due to higher economic activities in the country. They said the imports in April 2021 increased by 50 percent compared to Oct-Nov2020.

The government reduced imports by policy to bridge the trade deficit which was the main contributor towards the record $20bn current account deficit in 2020.

In reply to a question as to why the dollar gained against the rupee despite high foreign exchange reserves, the banker said it was due to a lack of confidence over the actual position of forex stocks.

“The exports could not increase in FY20 while the SBP’s reserves do not reflect the actual position since more than 40pc of their holding belongs to two Arab countries,” said the banker.

Currency dealers said the country got relief from G-20 for deferment of payments but the market knows that it would have to repay the debt in FY21 which weakens the exchange rate regime.

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