The Pakistani rupee fell to a new record low against the US dollar, depreciating 0.63% in the inter-bank market on Tuesday.
At close, the rupee settled at 299.01, a decrease of Rs1.88, as per the State Bank of Pakistan (SBP).
This is the lowest level for the rupee against the greenback. On May 11, 2023, it closed at the then-record low of 298.93.
On Monday, the rupee remained under pressure against the US dollar, as it settled at 297.13.
The rupee has come under pressure recently as a widening current account deficit amid ease in opening of letters of credit takes toll on the currency. Additionally, lack of further foreign exchange inflows have put pressure on the dollar position in the local market.
Fahad Rauf, Head of Research at Ismail Iqbal Securities Limited, told Business Recorder on Tuesday that the rise in import payments, after the International Monetary Fund (IMF) demanded to lift import restrictions, is leading to increase in demand for the greenback.
“This was reflected in the $0.8 billion current account deficit recorded in July,” he said.
“Moreover, there is also a need to narrow down the gap in the inter-bank and open markets, which has risen in recent days,” he added.
Internationally, the US dollar held close to a 10-week peak versus a basket of major peers, and near its highest since November against the yen, as Treasury yields rose made fresh post-financial crisis highs on Tuesday amid speculation US rates will be stay high for longer.
The US dollar index - which measures the currency against six developed-market counterparts, including the yen and euro - slipped 0.1 to 103.24, but remained not far from Friday’s high of 103.68, a level not seen since June 12.
Oil prices, a key indicator of currency parity, were little changed on Tuesday as investors stay sour on China’s economic prospects and demand from the world’s top crude importer, limiting the impact of supply cuts.
Inter-bank market rates for dollar on Tuesday
BID Rs 298.90
OFFER Rs 299.10
Open-market movement
In the open market, the PKR lost 2.00 rupees for both buying and selling against USD, closing at 303.00 and 306.00, respectively.
Against Euro, the PKR lost 6.00 rupees for buying and 7.00 rupees for selling, closing at 335.00 and 339.00, respectively.
Against UAE Dirham, the PKR lost 1.00 rupee for both buying and selling, closing at 84.20 and 85.00, respectively.
Against Saudi Riyal, the PKR lost 1.80 rupee for both buying and selling, closing at 82.50 and 83.30, respectively.
Open-market rates for dollar on Tuesday
BID Rs 303.00
OFFER Rs 306.00