The Pakistani Rupee (PKR) settled below its previous record low against the US Dollar (USD) and posted losses in the interbank market today.
It depreciated by 0.63 percent against the USD and closed at Rs. 206.46 after losing Rs. 1.29 in the interbank market today. The local unit hit an intra-day high of Rs. 205.74 against the USD during today’s open market session. Since the arrival of the new government on 11 April, the greenback is up by Rs. 24.07 against the PKR.
The rupee plunged further against the dollar for the fourth consecutive day as questions grew over the resumption of the country’s much-needed $6 billion IMF rescue package after the recently announced budget failed to satisfy the lender. Dealers reckon the rupee has been steadily declining as a result of the balance of payment issue and declining foreign exchange reserves. However, the IMF’s views on the budgetary measures put more pressure on the local unit.
It is noteworthy that the US Dollar climbed higher against other currencies as well. The British Pound was at $1.20135 after sliding to a 15-month low versus the dollar at $1.1934 on Tuesday, helpless by the possibility of a new referendum on Scottish independence, while the Euro stood at $1.0428 just above yesterday’s one-month low.
The dollar has already gained momentum in recent months as a result of the US Federal Reserve hiking rates ahead of most other major central banks, and it has gained even more territory in recent weeks as investors seek safe havens as they worry about the economic implications of quickly tightening financial conditions worldwide.
Globally, oil prices retreated back to the $120 level on Wednesday on concerns over fuel demand and global economic growth before an expected big hike in interest rates in the United States. Oil markets are nervous over what central banks around the world will do next and how that impacts oil demand for everyone.
Brent crude settled at $120 after briefly testing the $119 level, while the US West Texas Intermediate (WTI) settled above $117 per barrel.
The PKR dipped further against most of the other major currencies in the interbank market today. It lost 35 paisas against the UAE Dirham (AED), 37 paisas against the Saudi Riyal (SAR), 42 paisas against the Canadian Dollar (CAD), 73 paisas against the Australian Dollar (AUD), and Rs. 1.62 against the Euro (EUR).
Conversely, it gained 41 paisas against the Pound Sterling (GBP) in today’s interbank currency market.