Rupee weakens further, closes at 166.39
PHOTO: FILE
Pakistani rupee depreciated Rs0.43 against the US dollar in the inter-bank market on Tuesday and closed at Rs166.39.
According to the State Bank of Pakistan (SBP), the local currency had closed at Rs165.96 against the greenback on Monday.
With the latest drop, the rupee has depreciated 9.2% since hitting a recent high of Rs152.28 against the US dollar on May 14, 2021.
Earlier, the rupee dropped to a record low of Rs167.43 in August 2020.
Apparently, the authorities are letting the rupee depreciate to discourage rising imports and encourage exports in an attempt to narrow down the widening trade deficit, which poses a threat to the economy.
More importantly, the rupee may be moving down in search for its value fit for resuming the International Monetary Fund’s (IMF) $6 billion loan programme, which has been on hold for the past two months. Pakistan is set to hold staff-level talks with the IMF to resume the programme in September 2021.
Exchange Companies Association of Pakistan (ECAP) President Malik Bostan said the other day that the rupee was depreciating amid the unfolding political situation in neighbouring Afghanistan where the Taliban were in need of dollars to run the country.
Published in The Express Tribune, September 1st, 2021.
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