The rupee appreciated by 76 paise, or up by 0.26%, against the dollar on Thursday, according to the State Bank of Pakistan, a day after the International Monetary Fund and Pakistan reached a staff-level agreement on the first review under the stand-by arrangement (SBA).

In a post on X, the central bank said that the local currency closed at Rs287.38 against the closing of Rs288.14 on the previous day.

The agreement is subject to approval by the IMF’s Executive Board. Upon approval, Pakistan will have access to $700 million, bringing total disbursements under the nine-month loan programme to almost $1.9 billion.

It would be the second tranche to be released under the loan programme.

An IMF team, led by Nathan Porter, visited Islamabad from November 2-15, 2023, to hold discussions on the first review of Pakistan’s economic programme supported by SBA.

In its statement, the IMF called for returning to a market-determined exchange rate and rebuilding foreign exchange reserves.

“While inflows following increased regulatory and law enforcement helped normalize import and FX payments and rebuild reserves, the authorities recognize that the rupee must remain market-determined to sustainably alleviate external pressures and rebuild reserves. To support this, they plan to strengthen the transparency and efficiency of the FX market and to refrain from administrative actions to influence the rupee.”