Rupee Crashes Against US Dollar As IMF Postponement ‘Rumors’ Cause Panic

The Pakistani Rupee (PKR) halted gains against the US Dollar (USD) and posted huge losses in the interbank market today.

It depreciated by 1.15 percent against the USD and closed at Rs. 206.94 after losing Rs. 2.37 in the interbank market today. The local unit hit an intra-day high of Rs. 204.62 against the USD during today’s open market session.

The rupee closed in red against the dollar today after reports that the International Monetary Fund’s (IMF) loan program for Pakistan had been postponed. While Finance Minister Miftah Ismail later clarified that there was “no truth” to such news, sentiments in the forex market were bearish during trade on Tuesday as the local unit plunged.

It is also possible that the incumbent government is on its toes over Punjab’s upcoming by-elections, which might be putting a lot of pressure on various fiscal movements as the country explores fresh (but familiar) waters in the first full week of the new financial year.

Globally, oil prices slid in volatile trading on Tuesday as concerns of an imminent global recession curtailing fuel demand outweighed supply disruption worries, highlighted by an expected production cut in various European countries.

Brent crude settled below $113, while the US West Texas Intermediate (WTI) dropped below $110 to test levels at $108.6 per barrel, shedding last week’s gains.

The PKR slid against the other major currencies in the interbank market today. It lost 78 paisas against the Australian Dollar (AUD), Rs. 1.49 against the Euro (EUR), Rs. 1.69 against the Canadian Dollar (CAD), and Rs. 2.09 against the Pound Sterling (GBP).

Moreover, it lost 63 paisas against the Saudi Riyal (SAR) and 64 paisas against the UAE Dirham (AED) in today’s interbank currency market.