KARACHI: The Pakistani rupee hit a record low for the fifth consecutive day on Friday due to increased import payments, the country's bleak economic outlook and an overall weakening of regional currencies.
"The rupee was traded at 89.02 (to the dollar) and there are some (import) payments of about $50 million to $60 million today," said a bank dealer.
The rupee was trading at 88.92/89.02 to the dollar at 11:21 a.m. (0621 GMT), compared with Thursday's close of 88.73/83. The rupee has lost 3.8 percent this year.
In part, the Pakistani rupee's fall reflects pressure most regional currencies are facing. The Indian rupee lost 6.7 percent during November, before rallying on Thursday after the world's six major central banks initiated coordinated action to help ease the euro zone crisis.
There is also a generally gloomy outlook for Pakistan's economy. Dealers said there is concern over the current account deficit, which was $1.6 billion in the July-Oct period compared with $541 million a year earlier.
Islamabad has to start repaying an $8 billion International Monetary Fund loan in early 2012. Without additional sources of revenue, its foreign exchange reserves will come under pressure, analysts say.
Pakistan's foreign exchange reserves fell to $16.88 billion in the week ending Nov. 25. They hit a record $18.31 billion in the week ended July 30.
Dealers said relations between Pakistan and the United States were also worrisome, after a cross-border attack by NATO that killed 24 of the country's soldiers at the weekend.
US and Pakistani relations affect the rupee because Washington has influence with international lending agencies. Tensions make getting external funding more difficult, said Asif Qureshi, director at Optimus Capital Management Ltd.
Comments
Comments are closed for this article.