The Pakistani rupee (PKR) dropped further and posted heavy losses against the US Dollar today.
The Pakistani rupee was all red throughout intraday trade today with the interbank rate losing over Rs. 1 to reach 284.885 by 11 AM. By 1:25 PM, it stayed at the 284 level.
At close, the PKR depreciated by 0.35 percent and suspended movement at 284.84 after losing 99 paisas today.
The rupee ended the day with losses today. The local unit did manage to go as high as 283.4 before political noise rattled markets and bears took control.
Currency dealers said markets were red today after law enforcement agencies arrested former Prime Minister Imran Khan at Islamabad High Court on Tuesday, in a dramatic move that threatens more chaos if dragged for a long period.
It bears mentioning that investors lost confidence after Moody’s Investor Service (Moody’s) told Bloomberg that Pakistan may default if it does not receive a bailout from the International Monetary Fund (IMF) as its financing options beyond June remain uncertain.
Pakistan will meet its external payments for the remainder of this fiscal year ending in June, however, its financing options beyond June are highly uncertain. Without an IMF program, Pakistan could default given its very weak reserves, said the credit rating agency.
One trader said the rupee will drop even further after today’s events in Islamabad which saw scores of security personnel in riot-control gear taking Imran Khan away. Protests will likely bring down market sentiments if the situation persists for long, he added.
Pertinently, the rupee is down nearly Rs. 55 since January 2023. Since April 2022, it is down over Rs. 102 against the greenback. As per exchange rate movements witnessed today, the PKR has lost nearly Rs. 1 against the dollar.
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