Although it is a redundant movement, the Pakistani Rupee (PKR) slid to a new all-time low against the US Dollar (USD) and depreciated by one paisa against the greenback in the interbank market today. It hit an intra-day low of Rs. 178.22 against the USD during today’s open market session.
The local unit bent marginally against the USD by 0.01 percent and closed at Rs. 178.05 today after it held its own and closed at the 178.04 level in the interbank market on Monday, 20 December.
The rupee struggles to report any gains against the dollar on the back of the usual inflationary pressures that have impeded fiscal progression since mid-November. Moreover, Pakistan’s current account has recorded the highest deficit of $1.91 billion during the current financial year due to the soaring import bill, according to the statistics released by the State Bank of Pakistan (SBP) on Monday.
The staggering deficit poses a worrisome situation for the economy and the central bank which has consistently introduced various strict measures to curb non-essential imports in the country. However, results are yet to be seen as the import bill has remained out of control since the beginning of FY2021-22.
In light of the PKR’s interbank performance during the trading hours earlier today, the former Treasury Head of Chase Manhattan Bank, Asad Rizvi, tweeted, “[As] per SBP estimate of $13bn, CAD for FY22, July-Nov of $7.1bn is higher than expected”.
INTER BANK
Per SBP estimate of $ 13bn, CAD for FY22,July-NOV of $ 7.1bn is higher than expectation. Though remittances will roughly clock $ 31,higher imports is troubling,whereas pace of exports growth doesn’t support. At this pace CAD could hit 4.5% or higher by roughly $ 1.5bn
— Asad Rizvi (@asadcmka) December 21, 2021
He remarked that the growth in imports is troubling and the level of support offered in remittance inflows through exports growth is not enough.” At this pace, CAD could hit 4.5% or higher by roughly $1.5 billion,” he added.
The PKR reversed gains against most of the other major currencies as well. It posted losses of 56 paisas against the Pound Sterling (GBP), 54 paisas against the Australian Dollar (AUD), and 81 paisas against the Euro (EUR).
It held out against both the UAE Dirham (AED) and the Saudi Riyal (SAR) in today’s interbank currency market.
Conversely, the rupee appreciated against the Canadian Dollar (CAD) and posted gains of 21 paisas in today’s interbank currency market.
