Friday: Pakistani rupee continues its losing streak against the US dollar and declined further. After losing 2.76 in the interbank market, the local unit closed at 228.18.
According to the State Bank of Pakistan (SBP), yesterday the Rupee lost 2 and closed on 225.42). The higher demand for the greenback along with dollar appreciation against major currencies weighed on the local unit.
Pakistan’s currency is seemingly on the same path that it went down on two months ago when its unit hit 239.37. PKR has cumulatively fallen by 4.2% against the dollar in this week’s trade.
As per the currency dealer, after the government scrapped ban imposed on the import of luxury goods, there is a shortage of dollars in the market as compared to the high demand.
They also noted that like the rise in imports, remittances and exports did not increase to the required amount, thus, causing a disruption in the supply-demand position of the dollar.
The dollar is strengthening globally against major currencies which is also one of the reasons for its appreciation against the rupee. However, some other factors for the rupee’s depreciation are slower inflows, political unpredictability, investor decline in confidence in the economy, and higher foreign exchange requirements that are a result of flood-related expenses, a backlog of credit payments, and Afghan trade increase.
Pakistan has already surpassed the International Monetary Fund’s (IMF) loan disbursement cost for damage and devastation caused by the floods in one-third of the country.
While the Initial estimates economic damage caused by the floods has reached a staggering $10 to $12.5 billion.
