Rupee Drops Further Against US Dollar Ahead of No-Confidence Vote

The Pakistani Rupee (PKR) continued its historic drop against the US Dollar (USD) and reported losses in the interbank market today. The local currency lost 30 paisas against the greenback at the close of the session today.

It depreciated by 0.16 percent against the USD and closed at Rs. 182.64 today after losing 15 paisas and closing at Rs. 182.34 in the interbank market on Tuesday, 29 March. The domestic currency hit an intra-day low of Rs. 182.70 against the USD during today’s open market session.

The rupee crashed to another all-time low against the dollar today amid rising political uncertainty which has gripped the country for the better part of 2022. To recall, the country descended into political chaos after the opposition benches filed a no-trust resolution against Prime Minister Imran Khan with the National Assembly Secretariat on March 8.

In terms of global factors impacting the local economy, oil prices dropped by 2 percent on Tuesday as talks advanced between Russia and Ukraine to end their conflict. Further weighing on oil stocks, new lockdowns in China to curb the spread of COVID-19  prompted concerns that fuel demand could fall.

At the time of filing this report, Brent futures were trading at $112 per barrel, while the West Texas Intermediate (WTI) stood at $106 per barrel.

Discussing the local currency’s performance earlier during the day, the former Treasury Head of Chase Manhattan Bank, Asad Rizvi, remarked that the interbank market is “expected to remain shaky & nervous until the dust settles. This means [that the] the market will ignore the ups & downs of [the] economy”.

He added, “Data will not provide any firm guidance, as all funding & receivables in [the] pipeline could be delayed because of [the] uncertain condition[s].

The PKR struggled against other major currencies and reported losses in the interbank currency market today. It lost six paisas against the Saudi Riyal (SAR), eight paisas against the UAE Dirham (AED), 46 paisas against the Canadian Dollar (CAD), and Rs. 2.47 against the Euro (EUR).

Moreover, it lost 27 paisas against the Australian Dollar (AUD) and 61 paisas against the Pound Sterling (GBP) in today’s interbank currency market.



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