The Pakistani Rupee (PKR) continued its collapse against the US Dollar (USD) to reach an all-time low of Rs. 190.02. The local unit lost Rs. 1.36 against the greenback in the interbank market today.
The PKR depreciated by 0.72 percent against the USD and closed at Rs. 190.02 today, registering the rupee’s weakest closing in history. Yesterday, the PKR lost Rs. 1.13 against the greenback at the close of the session, closing at Rs. 188.66. The rupee has now lost over 7 percent against the US dollar since the start of the calendar year.
The greenback has soared against the rupee in recent days and has broken the record of a new all-time peak on consecutive days now. The rupee is under increasing pressure due to the mounting oil import bill and continued uncertainty over the fate of the International Monetary Fund (IMF) bailout.
The uncontrolled increase in imports coupled with a slower pace of growth in exports pushed the trade deficit to an all-time high of $39.264 billion during the first ten months (July-April) of the current fiscal year, 2021-22. The foreign exchange reserves held by the State Bank of Pakistan have also plummeted from over $20 billion in August last year to $10.499 billion on April 30, 2022.
Komal Mansoor, Head of Research at Tresmark told ProPakistani,
Low level of reserves, surging inflation, inability to attract new forex, and global volatility in all asset classes have thrown our fragile economy in turmoil, and the rupee is reflecting the heat. There’s nothing to stop this plunge unless we get a lifeline through fresh injection of dollars & IMF looks like the best bet at the moment.
Discussing the local currency’s performance during the day, the former Treasury Head of Chase Manhattan Bank, Asad Rizvi, said in a tweet that the unguarded rupee is directionless, which makes everything expensive. He added that the rupee hitting record lows have become common in recent months.
Rizvi said that the market will continue to remain vulnerable to imports and political uncertainty with taming inflation becoming an increasingly difficult task.
Unguarded #PKR is directionless that makes everything expensive.
Rupee is hitting all time new lows on regular basis that has become very common in recent times. Taming inflation is uphill task, but market will remain vulnerable to imports & political uncertainty.
— Asad Rizvi 🇵🇰 (@asadcmka) May 11, 2022
The PKR also reported losses against all the other major currencies in the interbank market today. It lost Rs. 1.43 against the Euro (EUR), Rs. 2.39 against the Pound Sterling (GBP), Rs. 1.51 against the Canadian Dollar (CAD), and Rs. 2.04 against the Australian Dollar (AUD).
The rupee also lost 37 paisas against the UAE Dirham (AED).