The consolidating Pakistani currency experienced a notable drop of almost 1%, or Rs2, to Rs216.66 against the US dollar in the inter-bank market on Monday in the wake of rising political uncertainty in the country.
The domestic currency hit an intra-day low of over Rs217 during the day, currency dealers said. It had closed at Rs214.65 against the greenback on Friday, according to the State Bank of Pakistan (SBP).
Experts said the surge in political uncertainty amid conflicting reports of likely arrest of former Prime Minister Imran Khan on terrorism charges weakened economic sentiments and caused a notable drop in rupee value.
They believed political stability is a must for economic growth and stability in rupee-dollar parity.
They recalled that the political instability had caused rupee having losing 13.75% or Rs31.31 to all-time low of Rs239.94 against the greenback on July 28, 2022 since no-confidence vote resulted into toppling former PM Khan’s government in April.
Later on, it recovered around 11% to around Rs214 in the ongoing month of August till last week, after IMF agreed to revive the stalled multibillion dollar loan prgoramme for Pakistan.
IMF executive board is scheduled to meet on April 29, 2022 to consider approving next tranche of $1.2 billion for Pakistan.
The expected foreign currency inflows including from other multilateral and bilateral creditors and additional $4 billion from friendly countries should not only help building up the country’s foreign exchange reserves, but should also support rupee stabilise around Rs215 these days, exchange market experts added.
Published in The Express Tribune, August 23rd, 2022.
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