The crackdown on illegal currency trading and smuggling has resulted in a $900 million surplus in the open market and deposited in banks.

General Secretary of the Exchange Companies Association of Pakistan (ECAP) Zafar Paracha said roughly $800-900 million had been deposited in banks since the crackdown began in September, 2023.

As a result of the crackdown, the daily average trading volume of exchange companies has increased to $50 million from $5-$7 million. Paracha said that dealers are selling up to $40 million per day to banks, and inflows from overseas Pakistanis are also significant.

The prominent view is the much-needed steps created beneficial economic gains while reforms on Afghan transit and Iranian oil smuggling also helped preserve hard-earned money.

In terms of support from overseas channels, remittances via exchange companies have climbed by up to 15 percent, and inflows through banks are expected to rise as well, Paracha added.

Notably, remittances are likely to increase by 25 percent to $2.5 billion in September. According to bankers, the State Bank of Pakistan (SBP) was also purchasing dollars from the interbank market for debt payments, but reports on the exact figure were inconclusive.

Trends and encouraging table talk from bankers reveal that the interbank market is seeing increased inflows as the dollar’s daily fall forced exporters to liquidate their entire holdings in exchange for a healthy profit.

Source: Pro Pakistani