The Pakistani Rupee (PKR) fell further against the US Dollar (USD) and posted losses during intraday trade today.
It depreciated by 0.10 percent and closed at Rs. 226.37 after losing 22 paisas. It quoted an intraday low of 226.625 against the greenback before close.
The local unit was all red against the greenback seventh day in a row and opened trade at 226.25 in the open market. By midday, the greenback moved lower against the rupee. After 1 PM, the local unit dropped and stayed on the 226 level against the top foreign currency before the interbank close.
The rupee reported losses against the US Dollar today after Finance Minister Ishaq Dar’s cryptic comments on the country’s state of the economy.
Dar said the disparity in the USD-PKR exchange rate between the interbank and open markets was now being properly addressed. He recalled how the markets caved the moment he boarded the flight to Pakistan. “I hadn’t even done anything as I did in 1999 or 2014. We were on the right track, with an Rs. 1.5 difference between interbank and open market rates”.
While assuring investors that there was no chance Pakistan would default any time soon, Finance Minister Ishaq Dar played it smooth by blaming the system for all the mess, including the country’s dwindling forex reserves.
“How will there be a default? There is no chance that Pakistan will default,” Dar reiterated. He acknowledged that the country is in a difficult situation, but he believes it will “survive” as long as things are managed properly.
He added that he is not to blame for the country’s reserves not being $24 billion as they were in 2016. “It’s not my fault. The flaw is in the system, and we must ensure Pakistan’s progress, “Dar stated.
Globally, oil prices fell on Wednesday as investors worried that rising COVID-19 cases in China, the world’s largest oil importer, would disrupt the country’s economic recovery and fuel demand growth as it eased pandemic restrictions. Both benchmarks fell by more than $1 per barrel earlier in the session after reaching a three-week high on Tuesday on expectations of increased fuel demand.
At 5:00 PM, Brent crude was down by $0.27 or 0.32 percent to reach $84.06 per barrel, while the US West Texas Intermediate (WTI) was also red at $79.32 per barrel.
Prices went down despite news that Russia intends to ban oil sales to countries that adhere to a G7 price cap imposed on December 5.
The PKR was bearish against most of the other major currencies in the interbank market today. It lost four paisas against the Australian Dollar (AUD), six paisas against the UAE Dirham (AED), nine paisas against the Saudi Riyal (SAR), and 24 paisas against the Canadian Dollar (CAD).
Conversely, it gained 22 paisas against the Euro (EUR), and 58 paisas against the Pound Sterling (GBP) in today’s interbank currency market.
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Ishaq secret weapon is flight to UK. I’m really surprised courts are silent on declared absconder. He is the well known dollar rate disruptor and despite blaming smuggling for open market rate difference his own govt failed to curb the so called practice, which in my opinion is intensional.