Pakistani rupee drops to new low against UAE dirham

The Pakistani rupee hit a new low against UAE’s dirham amid the Centre’s decision to approach the International Monetary Fund (IMF) for a bailout package and global equity sell-off.

The PKR was trading at 36.35 against the UAE dirham early morning on Tuesday, according to XE.com. On Monday morning, the rupee dropped to an all-time low of 36.44 against the UAE dirham, but recovered slightly later in the day. The currency, which has lost nearly 21 per cent since January 1, has devalued five time since December 2017.

"Today, the rupee was trading at 133.10 against the dollar, or 36.23 against the dirham, during early morning hours. It can fall to 135 against the dollar, or 36.75 against the dirham, in the coming days as the IMF feels the rupee is still overvalued and could further depreciate to 145 against the dollar and 39.50 against the dirham," said Rajiv Raipancholia, CEO, Orient Exchange, quoted Khaleej Times.

Raipancholia informed that the rupee has appreciated to 35.8 against the dirham on October 12 along with other Asian currencies due to the US dollar's weakness

Other experts were of the view that decline in the rupee to due to country's widening current account deficit and depleting foreign exchange reserves

"From an economic point of view, this situation can lead to inflation and rise in fuel prices in the country. However, Pakistani expats can greatly benefit from better exchange rates. We have seen a surge in remittances each time the currency has devalued as expats get more value on their money transfers," said Sudhesh Giriyan, COO, Xpress Money.