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The great fall continues: rupee settles at new all-time low of 276.58 against US dollar

  • PM Shehbaz's statement that IMF is giving tough time to Pakistan has dented sentiment, says one analyst
Published February 3, 2023

The Pakistani rupee slipped to another all-time low against the US dollar on Friday, closing over the 276 mark in the inter-bank market.

As per the State Bank of Pakistan (SBP), the currency settled at 276.58, a decline of Rs5.22 or 1.89% against the US dollar. The currency has depreciated by 25.93% during the ongoing fiscal year against the greenback.

Friday’s closing is the weakest level for the rupee, and comes as talks between the IMF and Pakistan continued in Islamabad.

Talking to Business Recorder, Saad Khan, Head of Research at IGI Securities, said the plunge comes on account of negative sentiment pertaining to talks with the IMF.

“PM Shehbaz said the IMF is giving Pakistan a tough time, which has dented market sentiment. Moreover, our forex reserves continue to deplete at a quick rate, which is also taking its toll,” he said.

“Market expects inflation to climb above 30% in recent months. The commitments made by the Finance Minister and SBP Governor on inflows are yet to be materialised, creating a perception that the authorities cannot do much to curb the ongoing deterioration,” he added.

Prime Minister Shehbaz Sharif on Friday said the IMF was giving Pakistan a hard time over unlocking a $1-billion loan at a time when the country’s economic situation is “unimaginable”.

On Thursday, Pakistan’s rupee had remained under pressure, as it had settled at 271.36, a decline of Rs2.53 or 0.93% against the US dollar.

Meanwhile, foreign exchange reserves held by the State Bank of Pakistan (SBP) dropped a massive $592 million to a mere $3.09 billion, data released on Thursday showed. This is the lowest level of central bank reserves since February 2014.

In another key development, Finance Minister Ishaq Dar on Thursday approved a proposal presented by Moulana Basheer Farooqi, Chairman of SWIT, to raise an interest-free $2 billion from overseas Pakistanis to alleviate the ongoing foreign exchange crisis.

Internationally, the euro and sterling slipped against the dollar on Friday as markets took a dovish cue from policymakers at the European Central Bank and the Bank of England, who said inflationary pressures in their economies have become more manageable.

Elsewhere, the greenback broadly advanced on the back of its Atlantic counterparts’ decline, reversing its losses earlier in the week. Against a basket of currencies, the US dollar index rose 0.03% to 101.82, away from Wednesday’s nine-month low of 100.80.

Oil prices, a key indicator of currency parity, made modest gains in early trade on Friday but were heading for a second straight week of losses, as the market looked for more signs of a strong recovery in fuel demand in China to offset looming slumps in other major economies.

Inter-bank market rates for dollar on Friday

BID Rs 277

OFFER Rs 279

Open-market movement

In the open market, the PKR lost 6.50 rupees for buying and 7.50 rupees for selling against USD, closing at 280 and 283, respectively.

Against Euro, the PKR remained unchanged for both buying and selling, closing at 294 and 296.50 respectively.

Against UAE Dirham, the PKR lost 1.30 rupees for buying and 1.40 rupees for selling, closing at 75.50 and 76.20, respectively.

Against Saudi Riyal, the PKR lost 1.80 rupees for buying and 2 rupees for selling, closing at 73.30 and 74, respectively.

Open-market rates for dollar on Friday

BID Rs 280

OFFER Rs 283

Comments

Comments are closed.

Abdul Sheikh Feb 03, 2023 12:56pm
How much Basheer Farooqi and ultra wealthy are contributing from their hard earned assets?
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Shani Feb 03, 2023 04:11pm
Basheer Farooqi must put conditions for election reforms and voting rights for overseas Pakistani. #SWIT
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bonce richard Feb 03, 2023 06:08pm
@Abdul Sheikh, Very very shameful that our Punjabi finance minister Dar ask Basheer to help the country. Very interesting now Mr. Basheer requesting overseas Pakistani to give donations like Zakat Fitra sadqa to the corrupted Nawaz family and army. Since 1947 we are begging others. When our generals retire how they live. Ask them to live 80 yds plot this is our blood money.
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G. Bal Feb 03, 2023 06:52pm
Inflation is going to knock the stuffing out of the population. It is not rocket science to predict that the masses will vent their anger soon, whether Pk goes with IMF conditions or defaults. The Dar's of the country will flee to UK as they are citizens of UK.
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Salim Feb 03, 2023 07:32pm
Soon we will hear Dar has pain in his back so that he can run away as always for medical reasons to UK
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TimeToMovveOn Feb 03, 2023 08:54pm
...meanwhile the PAK PM "has directed all the departments to harmonise their activities for effective observance of Kashmir Solidarity Day on February 5." So everyone in Pakistan please prepare for shouting Kashmir Banega Pakistan, and both Kashmir and the dollar rate will come down.
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Subhanullah Feb 03, 2023 09:34pm
Every one from Fin side is NOT sincere with the revival of economy. Lets take measure to boost the Dollars in Treasury. 1. Invite people from all over the world to invest Min one Mln and get Nationality. 2. Allow every one to open FC account and offer them interest @ 7%; then see its result. You will Not need IMF etc. 3 Cut your own NON development expenses. 4.Cut in Defence Budget.
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Joe Feb 04, 2023 02:15am
A big slap on the faces of sponsors of RC! Countries are not run on charity! Long live the dumb & duffers and the crooks & corrupt!
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