Pakistani Rupee further weakened against the US Dollar in the interbank market on Monday.
With a loss of 31 paisas, the rupee closed at 161.04 against the dollar on Monday as compared to 160.72 on Friday, data showed.
CEO of the financial advisory Alpha Beta Core, Khurram Schezad, spoke to ProPakistani and said, “It’s a short-term recovery after PKR improved against the USD about 6 percent from its low.”
He further remarked that there is still room for PKR to improve against the USD as there have been more inflows/supply of Dollars in the market compared to outflows.
On the other side, the smooth supply of USD from Remittances, Roshan Digital account, and other measures by the State Bank of Pakistan (SBP) has kept the overall exchange rate from dropping too low, too quickly.
PKR, which secured the third-best performing position in Asia, appreciated 3.1 percent against the greenback since October, has now reversed gains from the start of this week. Since Monday last week, it has lost 1.82 percent versus the dollar. Traders fear a surge in imports and the repayment of foreign debt could put pressure on the forex reserves and the rupee in the times to come.
The root cause for this change in PKR’s movement against the dollar is being attributed to the rise in the country’s imports. Temporary Economic Relief Facility (TERF) by the State Bank of Pakistan (SBP) is going to encourage even higher imports of machinery, which would make PKR lose against USD even more.