New day, new low: Rupee closes at 207.67 against dollar

Rupee continued its decline on Thursday as it fell to a new all-time low of 207.67 against the US dollar in the inter-bank market as post-budget uncertainty and the biggest rate hike announced by the US central bank since 1994 took toll on the currency market. The Pakistani currency fell to as low as 208.25 against the greenback in intra-day trading before staging a partial recovery.

At close, the local currency finished with a loss of Rs1.21 or 0.58% to settle at Rs207.67. On Wednesday, the rupee had closed at its then all-time low of Rs206.46.

Miftah says IMF lending critical to averting default

Speaking to Business Recorder, Arif Habib Limited Head of Research Tahir Abbas said that the local currency extended its fall on account of post-budget uncertainty.

Not asked Pakistan to renegotiate CPEC energy deals: IMF

Finance Minister Miftah Ismail had earlier said that the government's budget 2022-23, announced last week, failed to convince the International Monetary Fund (IMF) to disburse the next tranche of $6 billion loan programme to Pakistan, and amendments would be needed in the finance bill.

“The finance minister has clearly stated that IMF is not happy with the budget and there will be changes to it,” said Abbas.

“Once the amendments are incorporated in the Finance Act, only then will the rupee stabilise.”

He expected the local currency to remain volatile over the next few days.

Late on Wednesday, the government of Pakistan announced a third hike in the prices of petroleum products in less than three weeks, as it looks to quickly appease the IMF, which has emphasised the termination of energy subsidies to revive its bailout programme.

Pakistan is looking to receive $900 million as the next installment of the IMF programme, but the global lender has paused the Extended Fund Facility owing to a host of factors including fuel subsidies and a widening current account deficit. It has also said there is a need to raise more direct taxes.

3rd time's a charm?: Govt hikes price of petrol by Rs24.03, diesel by Rs59.16

Meanwhile, the Federal Reserve raised its target interest rate on Wednesday by three-quarters of a percentage point to stem a disruptive surge in inflation, and projected a slowing economy and rising unemployment in the months to come.

The rate hike was the biggest announced by the US central bank since 1994, and delivered after recent data showed little progress in its battle to control a sharp spike in prices.

Following the development, bearish bets on several Asian currencies hit a record high, a Reuters poll found, with short positions in China’s yuan and on Indonesia’s rupiah.

Inter-bank market rates for dollar on Thursday

  BID                            Rs 207.50  

OFFER                      Rs 207.70

  Open-market movement

  In the open market, the PKR lost 1.50 rupees for both buying and selling against USD, closing at 208 and 209.50, respectively.   Against Euro, the PKR lost one rupee for both buying and selling, closing at 217 and 219, respectively.   Against UAE Dirham, the PKR lost 30 paisas for buying and 20 paisas for selling, closing at 56.80 and 57.20, respectively.   Against Saudi Riyal, the PKR lost 50 paisas for buying and 40 paisas for selling, closing at 55.80 and 56.20, respectively.

  Open-market rates for dollar on Thursday

  BID                            Rs 208

OFFER                      Rs 209.50