SBP''s flexible exchange rate policy: rupee likely to lose more versus dollar

The rupee is likely to further lose its value against dollar due to flexible exchange rate policy of the State Bank of Pakistan (SBP). The Letter of Intent (LOI), submitted by the government of Pakistan to the International Monetary Fund (IMF), says that the SBP will continue to pursue a flexible exchange rate policy to strengthen the external position and maintain competitiveness.
In this context, interventions in the foreign exchange market would be largely aimed at achieving the program''s Net Foreign Asset (NFA) targets. The SBP has phased out the provision of foreign exchange for oil imports, and notified the market that it will cease to provide foreign exchange for imports of crude oil, from December 14, 2009.