- Closes at 176.79 in the inter-bank market on Tuesday
Pakistan's rupee was back at the receiving end against the US dollar, depreciating 0.18% to yet another historic low in the inter-bank market on Tuesday.
As per the State Bank of Pakistan (SBP), the PKR closed at 176.79 against the USD after a day-on-day depreciation of 31 paisas or 0.18%. A day ago, the market showed little excitement after getting $3 billion deposit from Saudi Arabia as PKR made marginal gains to appreciate 35 paisas against USD.
On Friday, PKR closed at then-record low of 176.77 against the USD. The rupee has declined 9.59% CYTD and 13.86% since its recent high recorded in May.
“The market is concerned over the terms and conditions of the Saudi fund facility as the rate is comparatively higher than the previous agreements,” Saad Khan, Head of Research at IGI Securities told Business Recorder.
The analyst added that the funds cannot be utilized to add liquidity in the market and would act as a reserve.
“Uncertainty regarding the Sukuk release by the government is also creating anxiety which will lead to speculation in the market,” Khan added.
Elaborating on the $1-billion funding from the International Monetary Fund (IMF), Khan said that the nod from the IMF paves way for other international lenders and will help Pakistan attract investment from other sources. “Secondly, IMF funding would also support rupee,” he said.
“In December, portfolio investment will enhance amid rise in the policy rate which will ease pressure on the balance of payment,” Khan added.
The analyst also expressed concern over the bulging imports bill, which hit $8 billion in the month of November. “The $8 billion import figure is unsustainable, and there is no other option than to curtail it,” Khan said, calling for proper lockdown on the import of unnecessary items.
The country’s trade deficit widened by 133.99% on a year-on-year basis and stood at $4.963 billion in November 2021 compared to $2.121 billion in November 2020. Imports witnessed 82.83% growth on a year-on-year basis in November 2021 and stood at $7.847 billion compared to $4.292 billion in November 2020.
Inter-bank market rates for dollar on Tuesday
BID Rs 176.79
OFFER Rs 176.89
In the open market, PKR gained 30 paisas for buying while losing 30 paisas for selling against USD, closing at 177.70 and 178.80, respectively.
Against Euro, PKR lost 20 paisas for buying and 60 paisas for selling, closing at 198.70 and 200.60, respectively.
Against UAE Dirham, PKR lost 1 paisa for buying while remaining unchanged for selling, closing at 49.31 and 49.80, respectively.
Against Saudi Riyal, PKR lost 5 paisas for buying and 10 paisas for selling, closing at 46.85 and 47.30, respectively.
Open-market rates for dollar on Tuesday
BID Rs 177.70
OFFER Rs 178.80