Free fall continues, rupee makes record low of Rs179.44

KARACHI: The free fall in the rupee value against the dollar continued on Wednesday, as the local unit fell to the new historic low of Rs179.44 in interbank foreign exchange market.

The rupee lost 22 paisas against the dollar to end at Rs179.44, compared with the previous day’s closing of Rs179.22 in the interbank market.

The local unit for the last three sessions witnessed a significant decline and lost 93 paisas against the foreign currency.

The dealers said that the local currency was declining due to the political unrest, volatile international oil prices and higher commodity import payments.

They said that the no-confidence motion against the prime minister by the opposition parties had resulted in negative sentiments in the market, adding that the dollar demand was also mounting due to the import of commodities related to the holy month of Ramzan.

The local forex market is also uncertain due to the volatile oil prices in the international markets. The oil prices have been witnessing continuous fluctuation since the Russia-Ukraine war began on February 24, 2022.

Pakistan is a net importer of petroleum products and changes in the prices directly affects the oil import bill of the country.

The import of petroleum products recorded over 100 per cent increase to $12.94 billion during the first eight months (July – February) 2021/22, compared with Rs6.44 billion in the corresponding months of the last fiscal year.

Further, the fall in foreign exchange reserves also put pressure on the rupee value. The liquid foreign exchange reserves of the country slipped by $206 million to $22.669 billion by the week ended March 4, 2022 as against $22.875 billion a week ago.

The local currency remained under pressure since the start of the current fiscal year. The rupee lost Rs21.90 or 13.90 per cent from Rs157.54 to dollar on June 30, 2021 to the current level of Rs179.44.

At the open market, the buying and selling of the dollar was recorded at Rs179.40 and Rs180.85 at 3:45pm PST.