Malik Bostan, Chairman of the Exchange Companies Association of Pakistan, has said that the dollar price will not increase further and the public should avoid hoarding dollars as the dollar price is likely to return to Rs 270.
Malik Bostan said that a major reason for the increase in the value of the dollar in recent days is smuggling in Afghanistan and Iran, where smugglers’ agents are buying dollars from the market by offering higher rates than legal money changers and due to this, the supply of dollars at the counters of legal money changers has decreased and dollars are being sold in the grey and black market.
He said that after the implementation of tax on cash transactions exceeding Rs 200,000 under the recent law of the Federal Board of Revenue (FBR), non-filers are hiding their identities by buying dollars from the black market, which has increased the demand for dollars.
Malik Bostan said that he has suggested to the government that according to the State Bank circular, tax should not be imposed on cash purchases of up to $2,000 so that the public buys dollars through legal channels.
He said that the law enforcement agencies have taken immediate action on these suggestions and the FIA has started raids against currency smugglers.
He said that these actions have started to have positive effects and today the dollar price in the open market has come down to Rs 288 after a decrease of 60 paise, while in the interbank market the dollar closed at Rs 284.76 paise, down from Rs 285.
Malik Bostan expressed hope that if the crackdown against hundi hawala continues in the same way, the dollar price could fall to Rs 280, 270 and even Rs 250.
He said that the State Bank has increased its reserves to $20 billion by purchasing $9 billion from the interbank market in the last 9 months and has now stopped buying dollars from the interbank market, after which the value of the dollar will not increase further, but rather a decrease is expected.
Malik Bostan has warned the public not to listen to rumors, avoid hoarding dollars and prefer transactions through legal channels because the rupee is currently undervalued and the actual value of the dollar is Rs. 250.
