Since December, the rupee has cumulatively shed close to 9% of its value after the central bank reportedly abstained from intervening in response to the pressure due to a widening current account deficit
PHOTO: AFP
The State Bank of Pakistan has maintained that the slide in the rupee’s value is due to supply and demand dynamics of foreign exchange in the inter-bank market. While it has promised prompt intervention in case of speculative or momentary pressures, the central bank will sit on the fence and let “market-driven adjustment in the exchange rate to continue to contain the imbalance in the external account and sustain a higher growth trajectory”, according to a press statement.
Published in The Express Tribune, June 5th, 2018.
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