The Pakistani Rupee (PKR) slid to a record low against the US Dollar (USD) second day in a row and depreciated by 34 paisas against the greenback in the interbank market today. It hit an intra-day low of Rs. 176.80 against the dollar during today’s open market session.
The local currency depreciated by 0.20 percent against the USD and closed at Rs. 176.77 today after it lost 94 paisas and closed at Rs. 176.42 in the interbank market on Thursday, December 02.
The local currency has lost 0.75 percent on a week-on-week basis after recording another historic low today. On a month-to-date and week-to-date basis, the rupee has depreciated by 0.60 percent and 10.59 percent, respectively.
The PKR has depreciated by 13.85 percent since its high on 14 May amid high inflationary pressures and the usual fiscal delays.
PKR continues to fall, closing at all-time low of 176.77, down 0.20% DoD.
Today’s Closing: 176.77, -0.20%
-9.58% CYTD
-13.85% since its recent high (14-May-21)
-10.88% FYTD@StateBank_Pak#SBP #Pakistan #Economy #AHL pic.twitter.com/cnH5KPJiJx— Arif Habib Limited (@ArifHabibLtd) December 3, 2021
Rupee Spillover
The local unit continued its resounding plunge against the US Dollar on the back of news that forex reserves fell week-over-week by $275 million (1.2 percent). Adding more fuel to the fire, Pakistan’s monthly trade deficit has soared by 162.4 percent, rising to $5.107 billion from $1.946 billion during the period under review.
Analysts and experts have blamed a multitude of factors, including inflation and trade deficit as reasons for the plunge. Yesterday’s horrid PSX drop has also added to extreme negative-vertical pressure on the Pakistani Rupee and propelled interest rates to swell up simultaneously.
The former Treasury Head of Chase Manhattan Bank, Asad Rizvi, summarized today’s interbank fiasco in a tweet that explained how November’s import bill is affecting the exchange ledger. He said, “Net SBP Fx Reserves fell by $243.8mn to $16.01bn. Higher Import bill has widened the trade gap, resulting fall in RESERVES.”.
INTER BANK
Net SBP Fx Reserves fell by $243.8mn to $ 16.01bn. Higher Import bill has widened the trade gap, resulting fall in RESERVES. OPEC decision to add 400mbd from January may soften oil prices. While funding delay is adding pressure that can push #PKR to test yet new lows pic.twitter.com/aTM513s7Un
— Asad Rizvi (@asadcmka) December 3, 2021
He added, “OPEC decision to add 400mbd from January may soften oil prices. While funding delay is adding pressure that can push #PKR to test yet new lows”.
While the Rupee continues to take hits, the currency is expected to stabilize as soon as funds are received from international lenders. Pakistan is expected to receive $3 billion from Saudi Arabia in the coming days, and experts are banking on the notion that it will help ease pressure on the currency.
The PKR reversed most of its gains against other major currencies as well and posted losses in the inter-bank currency market today.
It posted losses of 24 paisas against the Pound Sterling (GBP), and six paisas against the Chinese Yuan (CNY). It also posted losses of nine paisas against both the UAE Dirham (AED) and Saudi Riyal (SAR) in today’s interbank currency market.
The Rupee held out against the Euro (EUR) and lost one paisa against the eurozone currency.
Conversely, the local currency reversed losses against the Australian Dollar (AUD) and Canadian Dollar (CAD), posting respective gains of 66 paisas and 27 paisas in the interbank current market today.
