- Currency falls for fifth straight day in inter-bank market, loses value in open market as well
Pakistan's rupee continued to depreciate against the US dollar, falling another 0.25% to close at 174 .43 in the inter-bank market on Monday.
As per the State Bank of Pakistan (SBP), the PKR closed at 174.43 against the USD, a day-on-day depreciation of 43 paisas or 0.25%. On Friday, the PKR had dropped to the-then record low of 174.
The PKR has lost 12.7% of its value against the greenback since its recent high in May. It has depreciated 9.7% during the ongoing fiscal year alone, raising concerns over inflation.
Uncertainty over talks with the International Monetary Fund (IMF) has created a sense of uneasiness in the market, said Tahir Abbas, Head of Research at Arif Habib Limited (AHL), while talking to Business Recorder.
“Lack of clarity on IMF negotiations has raised concerns in the market, as uncertainty regarding the outcome and the timeframe has created pressure on the rupee,” said Abbas.
Abbas said that it is important to have successful negotiations with the international lender, otherwise, Pakistan would need to look for other sources for funds “which will be a difficult path”.
Pakistan is seeking a $1-billion tranche under the Extended Fund Facility (EFF) of the IMF.
Abbas, however, remained optimistic that the resumption of the IMF programme will cool off the demand pressure on the rupee.
Earlier, Business Recorder reported that Pakistan has agreed to implement most of the conditions of the IMF for the resuscitation of its stalled $6 billion extended loan facility. Sources divulged on Saturday that Pakistan succumbed to the global lender pressure, agreeing to implement most of the conditions which the Fund had proposed.
Sources said that Pakistan agreed to raise tax collection, speed up the privatisation process and introduce reforms in the power sector as suggested by the international money lender.
Inter-bank market rates for dollar on Monday
BID Rs 174.40
OFFER Rs 174.50
In the open market, the PKR lost 1.30 rupees for buying and 1.20 rupees for selling against USD, closing at 174.80 and 175.50, respectively.
Against Euro, the PKR lost 1.10 rupees for buying and 1.30 rupees for selling, closing at 201.70 and 203.50, respectively.
Against UAE Dirham, the PKR lost 10 paisas for buying while remaining unchanged for selling, closing at 49.40 and 49.85, respectively.
Against Saudi Riyal, the PKR gained 65 paisas for buying and 1.40 rupees for selling, closing at 45.85 and 46.30, respectively.
Open-market rates for dollar on Monday
BID Rs 174.80
OFFER Rs 175.50