KARACHI: The rupee again showed stability in the inter-bank market, depreciating just 0.3% to settle at 225.64 against the US dollar during the previous week. However, with extreme administrative controls in place taking down the number of trades, it was the informal markets stepping in to fill the gap where reports suggest the currency traded in the range of 255-260.
The rupee has lost 3.4% since the second week of October, but that is a far cry from the currency’s performance in 2022 that has seen it lose nearly 22% against the US dollar.
During the week, foreign exchange reserves held by the State Bank of Pakistan (SBP) declined another $584 million to a critical level of $6.12 billion, the lowest since April 2014, underscoring the urgent need for the International Monetary Fund (IMF) programme to get back on track.
However, with talks stalled on the ninth review and reportedly tough conditions on the table, it seems it may take a while before the programme is back on track.
Rupee remains under stress against US dollar
At the same time, another downgrade also took place as global ratings agency S&P Global on Thursday cut Pakistan’s long-term sovereign credit rating by one notch to “CCC+” from “B” to reflect a continued weakening of the country’s external, fiscal and economic metrics.
Open-market rates
In the open market, the PKR lost 55 paisas for buying and 50 paisas for selling against USD, closing at 232.25 and 234.50, respectively.
Against Euro, the PKR lost 4 rupees for both buying and selling, closing at 260 and 262, respectively.
Against UAE Dirham, the PKR lost 1.60 rupees for both buying and selling, closing at 68.90 and 69.40, respectively.
Against Saudi Riyal, the PKR lost one rupee for buying and 90 paisas for selling, closing at 65.30 and 65.70, respectively.
Copyright Business Recorder, 2022
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