Rupee Nears All-Time Low Against the US Dollar

The Pakistani Rupee (PKR) has reported losses against the US Dollar (USD) once again and depreciated 48 paisas against the greenback in the interbank market. It hit an intra-day low of Rs. 176.55 against the USD during today’s open market session.

The local currency depreciated by 0.27 percent against the USD and closed at Rs. 175.46 today after it posted blanket gains of six paisas and closed at Rs. 174.98 in the inter-bank market on Thursday, 25 November.

SBP | daily rates | ProPakistani

The local currency has surpassed its former record low against the USD from 26 October when it closed at Rs. 175.27, and is only a touching distance away from its all-time low of Rs. 175.73 from 12 November.

Another Rupee Spillover

The Rupee ended this week with a bludgeoning as the foreign exchange reserves held by the State Bank of Pakistan (SBP) had a massive outflow of $691 million, dropping to a seven-month low.

The SBP’s data stated that the foreign exchange reserves declined by $1.25 billion over the last 15 days. On the other hand, the required inflows of foreign exchange have not arrived in Pakistan’s external account. This outflow of the reserves has put pressure on the value of the Rupee against the Dollar.

Although pressures continue to build from all sides as fiscal parities struggle to correlate, it is expected that over $1 billion tranches from the International Monetary Fund (IMF) coupled with the financial assistance of $3 billion from Saudi Arabia will improve the foreign exchange level in the next few weeks, and in extension, the Rupee as well.

The former Treasury Head of Chase Manhattan Bank, Asad Rizvi, discussed the Rupee’s interbank showing in a tweet earlier today. He discussed how the central bank’s net reserves have collapsed by $691.3 million to a seven-month low of $16.254 billion.

He remarked, “The drop since AUG is worrisome. Early S.A DEPO of $3bn may help, but will not be enough to attain [the] crucial $20bn number, unless IMF funding is released earlier, as higher imports will add pressure on Fx RESERVES & #PKR”.

The PKR showcased a mixed performance against other major currencies as well and posted losses against most of them in the interbank currency market today.

It gained 89 paisas against the Canadian Dollar (CAD), 92 paisas against the Australian Dollar (AUD), two paisas against the Pound Sterling (GBP), and blanket gains of four paisas against the Malaysian Ringgit (MYR).

In contrast, the Rupee re-entered its decrepit sway against the resurgent Euro (EUR) after it posted losses of Rs. 1.54 against the eurozone currency. It also posted blanket losses of five paisas against the Chinese Yuan (CNY).

Moreover, it posted losses of 12 paisas against both the UAE Dirham (AED) and the Saudi Riyal (SAR) in the interbank currency market today.