We stopped dollar getting as low as 50 60 - Nawaz Sharif

[senses]

Damn i shouldn't have dropped the economics in my Alevels...

 

[Sherlock Holmes]

Damn i shouldn't dropped the economics in my Alevels...

I had one course of Economics in my bachelors And my degree was not related to economics or business studies.

 

[senses]

I had one course of Economics in my bachelors And my degree was not related to economics or business studies.

Dunno why people are saying dollar depreciation is bad,they way i see it is if dollar decrease,petroleum prices decreases which is a win win for every one but again i am a economic illiterate so don't go hard on me.

 

[SQ8]

You never bring down currency dramatically. It offsets the trade balance in one party's favor, it also literally stops investments as the investor's get scared of losing money. You guys still live in the world and import a lot of stuff and are getting a lot of investments. If you scare the world off, your system might have a cheaper dollar but it'll collapse shortly after such a huge dip.
By bringing the dollar to its current level and the government officials making statements that it can go further down, you've politely warned the investors so that they have room to adjust and not collapse.
1) It sends out a message to the investment community that they should expect lesser profits BUT the market has become stronger so they should feel safer about their money
2) The country has a strong and stable government with good policies, which results in long term gains at a higher level even though short term gains may be little due to local currency's value increasing vs. the USD
3) Future loans to the country and to its projects will be issued at a cheaper rate, easily and with more funding options due to the above three.

If anyone of you follow the world economy and associated bodies, the Moody's index has already changed Pakistan's outlook from Negative to Positive (HUGE step for investments), it is primarily because of all of the above, a stronger economy, better policies, better return and a country becoming more stable.

Economics has little to do with pointless idiotic point scoring displayed by members of Tabdeeeeee.......eeeli here.
Surprising considering that one of the country's brightest financial minds is a senior member of that party.

1) That depends on the sort of investors, hedge fund investors may mixed feelings about that; and these days the KSE has a little love affair with hedge funds.

2) No argument there, except as mentioned by @FaujHistorian , currency traders and short term commodity importers may not be very happy with it.

One "conspiracy theory" (if there must be one) is that those with their wealth abroad may breath a sigh of relief since it keeps their wealth at a higher relative value.

Could someone explain how exactly is the $ supposed to be Rs50-60? Massive internal and external borrowing will shore up currency to boost reserves. Then comes the time to pay the interest rates. When inflation rates are rising one of the simple explanations is that more legal tender is floated. Which in simple term means that you photocopy more money. Now these are simple indicators. All economies are complex. Now in simple terms how exactly is the strengthening of the rupee taking place with close to 9% inflation rate in reference to what Nawaz Sahrif nay Farmaya.

Short term trading would push the dollar down further( but that would have happened with the influx of "grants") ..and I doubt the 50-60 figure, may be closer to 75-80.

 

[Sherlock Holmes]

Economics has little to do with pointless idiotic point scoring displayed by members of Tabdeeeeee.......eeeli here.
Surprising considering that one of the country's brightest financial minds is a senior member of that party.
1) That depends on the sort of investors, hedge fund investors may mixed feelings about that; and these days the KSE has a little love affair with hedge funds.
2) No argument there, except as mentioned by @FaujHistorian , currency traders and short term commodity importers may not be very happy with it.
One "conspiracy theory" (if there must be one) is that those with their wealth abroad may breath a sigh of relief since it keeps their wealth at a higher relative value.

I am not a member of PTI.

 

[SQ8]

I am not a member of PTI.

Not saying you are.

 

[Sherlock Holmes]

Short term trading would push the dollar down further( but that would have happened with the influx of "grants") ..and I doubt the 50-60 figure, may be closer to 75-80.

Question is will the foreign investors pay more for same production after energy bill reductions and labor cost increase? If they have to pay more after reduced energy bills then they will fly away to Bangladesh, Malaysia or China.

 

[Sherlock Holmes]

Dunno why people are saying dollar depreciation is bad,they way i see it is if dollar decrease,petroleum prices decreases which is a win win for every one but again i am a economic illiterate so don't go hard on me.

Read my other posts man. I already explained it.

 

[That Guy]

A startling jump like that would cripple the economy, making everything more expensive for businesses.

Whether this news is true or not is irrelevant. What you guys need to know is that the currency needs to change it's value slowly, so the market has time to adjust.

 

[Viper0011.]

1) That depends on the sort of investors, hedge fund investors may mixed feelings about that; and these days the KSE has a little love affair with hedge funds.

One "conspiracy theory" (if there must be one) is that those with their wealth abroad may breath a sigh of relief since it keeps their wealth at a higher relative value.

Investors are investors. The same investors that do hedge funds, also do securities, that's how they offset risks . Love my little Wall street experience. A news about a potentially big market becoming safer to invest in and has credentials to back it up (Moody's for example), is NEVER a bad news. Investors who do short term investments, immediately start looking into long term potential. So a good news is always a good news on the "street" if you will.

At a level where people have wealth "abroad", frankly speaking, a few hundred thousands don't matter. When you take your wealth into a foreign country, it is already assumed that you have too much money to spare and invest elsewhere, so a few thousand or few hundred thousand become irrelevant in my opinion

 

[W.11]

ganja honestly doesn't look like he is brilliant in economics and would rescue our economy, but ganja is trying atleast (maybe even try to multiply his assets in the mean time) this would produce better results than PPP's not even trying days, also PPP faced many natural disasters and the country just had noora and jyala rule for the first time so PPP had to do a lot of diplomacy to stay for five years, now that the army clearly has indicated it has no mood for adventure thus ganja's back will feel safe and would concentrate in doing something this time (given loads of nihari and naan supply to keep him away from distraction)

but what pakistan needs is a government which is uptight and confident and they also have loads of talents, ganja would at best try to float the country till their period is over and will be respectfully kicked out for better people hopefully

 

[Viper0011.]

but what pakistan needs is a government which is uptight and confident and they also have loads of talents, ganja would at best try to float the country till their period is over and will be respectfully kicked out for better people hopefully

Which government will this be? The one you have is the best you get. The rest is all talk. You can't use PHD's here with theory, the best fix is through folks who know the business and can bring in investments as your tax base is so poor that it can't even run your country for more than a few months on its own.
So if you take a look around, you actually have what your country needed. Let these people work as they are doing what's right, with long term planning and have brought in billions of dollars worth of investment, even with the terrorism on the streets and all. That's some serious PR. Outside of these guys, who have built relationships across, there is no one who can do it in PRACTICAL. I am sure you have a ton of people with paper and theories running around like wild rumors. No backing or credentials from the international community which actually matters the most. So be thankful that God put in the right leadership at the right time and the facts speak for itself.
A CFO's job in an organization is to bring in investment and take the financial health of the company forward. That's also what a Prime Minister does (take a look at Modi and what he's been focusing on just after a few weeks of being in the office). So before you take the readers on wild mental chase, know that you couldn't have anyone better than what you have to take your country forward in this messy situation.
Respect other's mandate, the democracy and the system. People who break the line, can do that a couple of times. At some point, other people standing in the line won't let you in as you are messing up the system. Don't mess up the system and let your country progress.

 

[Sherlock Holmes]

Rupiah Drops to Four-Month Low as Central Bank Helps Exports - Bloomberg

Rupiah Drops to Four-Month Low as Central Bank Helps Exports

Indonesia’s rupiah fell to the lowest level since February after the central bank said it will allow weakness in the currency to help exports.

Bank Indonesia is letting the rupiah be temporarily “undervalued” to improve the competitiveness of the nation’s shipments and to reduce imports, Senior Deputy Governor Mirza Adityaswara said in Jakarta yesterday. The trade shortfall widened to $1.96 billion in April, the largest since July last year. That weighs on the current-account deficit, which is set to expand this quarter from the 2.06 percent of gross domestic product recorded in the first three months of the year.

The currency fell 0.8 percent to close at 12,090 per dollar, prices from local banks show. It reached 12,094 earlier, the lowest level since Feb. 12. In the offshore market, one-month non-deliverable forwards declined 0.9 percent to 12,151, trading 0.5 percent weaker than the onshore spot rate, data compiled by Bloomberg show.

“Bank Indonesia will likely pare back intervention and allow some weakness,” said Leo Rinaldy, an economist at PT Mandiri Sekuritas in Jakarta. “Dollar demand for imports ahead of Ramadan, political uncertainty and rising oil prices still contribute to weakening pressure for the rupiah.”

Spending typically rises during the Muslim fasting month of Ramadan, which will start in late June, while Indonesians head to polls on July 9 to choose a president. Oil prices have climbed this month as militants captured territory in Iraq, the Organization of the Petroleum Exporting Countries’ second-largest producer.

Volatility, Fixing
The rupiah’s one-month implied volatility, a measure of expected swings in the exchange rate used to price options, rose 94 basis points to 10.88 percent, the highest since May 5. Bank Indonesia set a fixing used to settle rupiah forwards at 12,027 per dollar today, from 12,000 yesterday.

The government’s 8.375 percent bonds due March 2024 declined for the fourth straight day, pushing the yield three basis points, or 0.03 percentage point, higher to 8.225 percent, according to the Inter Dealer Market Association. That’s the highest level since March 25.

 

[acetophenol]

What should i say ?

Please help me understand,is he saying that he stopped USD from devaluing?

 

[rockstar08]

mere pas spare 20$ hain ...yaar dollar 200 ka karo pleaseeeeeeeeeeeeeeeeeee