The burden of Pakistan's external debt has increased by Rs 661 billion since the rupee depreciation began three days ago. From Wednesday 15 May, the State Bank of Pakistan (SBP) ceased to provide an indicative level to banks' treasuries within which the rupee, dollar may freely fluctuate, a decision that is sourced to the staff level agreement with the International Monetary Fund which stipulates a market determined as opposed to a managed or a free float exchange rate.
Sources in the Finance Ministry told Business Recorder that from 1 July till March 2019, the depreciation impact of the rupee against the dollar on debt was estimated at Rs 1,421 billion. Sources further stated that depreciation impact of the rupee against the dollar on debt was estimated at Rs 1,170 billion in 2018, while it was estimated at Rs 8 billion in 2017. Depreciation impact of the rupee against the dollar on debt was estimated at Rs 172 billion in 2016 and Rs 152 billion in 2015.
The inter-bank market rate for dollar against rupee was Rs 141.67 on Wednesday which rose to Rs 147.87 on Friday. According to exchange companies, the dollar was traded between Rs 152 to Rs 155 at the open currency markets at Islamabad Friday. The dollar was available at certain currency shops and sold between Rs 152 and Rs 155.
On Thursday, May 16, the US dollar hit a historic high of Rs 148 against the rupee in the inter-bank market, though the market closed at Rs 146.52. It was traded at Rs 148 to Rs 155 at the open currency markets of Islamabad. On Wednesday May 15, the dollar was traded between Rs 145 to Rs 147, in the open market and closed at Rs 144 in the open market. According to US/Pak rupee exchange rate updated on the website of the State Bank on May 15, 2019, the dollar weighted average bid rate in inter-bank was Rs 141.1573 and offer was Rs 141.5317.
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