- Closes at its weakest level of 178.15
Pakistan's rupee lost ground yet again on Wednesday, closing down another 10 paisas in the inter-bank market to end at its weakest level in history.
As per the State Bank of Pakistan (SBP), the PKR closed at 178.15 against the USD after a day-on-day depreciation of 10 paisa or 0.06%. This is the weakest closing for the rupee against the US dollar in the inter-bank market.
On Tuesday, the PKR closed at 178.05 against the USD.
Cumulatively, the rupee has depreciated over 11% CYTD and 13% on a FYTD basis against the US dollar.
The decline comes after Pakistan's current account deficit widened slightly to $1.91 billion in November 2021, from $1.76 billion in October 2021, showed data released on Monday, as imports outstripped strong exports and remittances.
However, the import number of $6.4 billion is $1.5 billion lower than the Pakistan Bureau of Statistics (PBS) figure of $7.9 billion, which is probably the biggest gap seen in any month between SBP and PBS numbers.
“The CAD of $1.9 billion in November remains on a higher side on a month-on-month basis,” Tahir Abbas, Head of Research at Arif Habib Limited (AHL), told Business Recorder.
Abbas added that the difference in import figures data between the SBP and PBS will be incorporated in the coming months.
"The PBS tracks shipping data, whereas SBP tracks payments data, which is the main difference.
“However, there is a large difference in data of the two entities regarding oil imports,” said Abbas, who was of the view that there could be an error at the PBS end.
Meanwhile, Fahad Rauf, Head of Research at Ismail Iqbal Securities, said that the exchange rate is under pressure due to the current account deficit.
“Pressure will continue to remain in the coming months, as commodity prices have not come down yet. If CAD remains in $1.5-2 billion range in coming months, pressure would remain on the exchange rate,” Rauf told Business Recorder.
He said that the data gap has also caused confusion in the market. “Furthermore, delay of mini-budget has raised concerns among market participants regarding the IMF programme,” he said, while adding that positive triggers are not in sight until the IMF funds are received.
Inter-bank market rates for dollar on Wednesday
BID Rs 178.10
OFFER Rs 178.20
In the open market, PKR gained 10 paisas for both buying and selling against USD, closing at 178.90 and 179.90, respectively.
Against Euro, the PKR lost 1 rupee for buying and 50 paisas for selling, closing at 200 and 201.50, respectively.
Against UAE Dirham, the PKR lost 30 paisas for both buying and selling, closing at 50.20 and 50.60, respectively.
Against Saudi Riyal, the PKR remained unchanged for both buying and selling, closing at 47 and 47.40, respectively.
Open-market rates for dollar on Wednesday
BID Rs 178.90
OFFER Rs 179.90