Rupee can strengthen to 160 against US dollar in few months: Ishaq Dar

• Ishaq Dar says rupee-dollar parity will improve once economy is steered in right direction.
• He, however, says rupee-dollar parity cannot be administratively controlled beyond "limited intervention".
• CItes previous govt’s “incompetence” as prime reason behind rupee’s record-breaking downward streak.

PML-N leader and former finance minister Ishaq Dar revealed that the US dollar can come down to Rs160 in a few months when “fiscal and monetary policies are fixed”, Business Recorder reported.

During an interview with the Aaj News, Dar maintained that the rupee-dollar parity will improve once Pakistan’s economy is steered in the right direction, citing the previous government’s “incompetence” as the prime reason behind the rupee’s record-breaking downward streak.

During the PML-N's tenure, the government kept the rupee strong against the US dollar which irked the International Monetary Fund (IMF) and exporters, who argued that keeping the currency “artificially strong” negatively affects the economy in the long run.

Read more: World Bank improves Pakistan's GDP growth prospects by almost 1%

However, Dar mentioned that the rupee-dollar parity cannot be administratively controlled beyond "limited intervention".

"Dollar cannot be administratively (controlled) — you can intervene in a limited way. Economic fundamentals need to be right, inflation needs to be in control, the fiscal deficit needs to be in control, while foreign exchange reserves need to be at the right level."

When categorically asked by the host if the rupee could strengthen to Rs160 against the greenback, Dar said "it can".

"God willing, it can. But you will have to work hard for it. You will need to fix economic policy. You will need to take fiscal and monetary measures as well as set economic direction. Revenue has to be increased. Once the direction is right, the dollar can be stabilised."

Read more: Rupee's recovery streak continues unabated for fourth session

Regarding inflation, the PML-N leaders blamed the previous government’s decision to give a “freehand” to the exchange rate.

Calling it the “mother of all evils”, he said: "When inflation started rising, they increased the interest rate, attracting 'hot money. When the pandemic came, they decreased the interest rate, and an outflow of dollars occurred."