Rupee slides for third straight day on record oil prices hike

KARACHI: The rupee fell for the third straight day against the dollar on Thursday as oil prices in the international markets jumped to the 8-years high.

The exchange rate recorded 21 paisas decline in the rupee value to close at Rs177.83 to the dollar from previous day’s closing of Rs177.62 in the interbank foreign exchange market.

The local currency lost around 42 paisas against the dollar during the past three trading sessions.

The international oil prices recorded a massive jump following Russian supply concerns due to war with Ukraine. The benchmark Brent crude recorded an 8-years high at $119 per barrel.

The dealers said that the higher dollar demand for oil payment may further deteriorate the rupee value. The local currency fell to the record low at Rs178.24 against the dollar on December 29, 2021.

The import bill of the petroleum group recorded an increase of 107 per cent to $11.7 billion during the first seven months of the current fiscal year, compared with $5.64 billion in the corresponding months of the last fiscal year.

Further, the widening of the current account deficit and falling foreign exchange reserves may also deteriorate the rupee value.

The country’s Current Account Deficit (CAD) surged to its highest ever monthly deficit of $2.6 billion in January 2022 ($1.9 billion in December 2021) taking CAD of $11.6 billion during the first seven months of the current fiscal year.

The local unit recorded a decline of Rs20.29 or 12.75 per cent from Rs157.54 on June 30, 2021 to the present level of Rs177.83.

At the open market, the buying and selling of the dollar was recorded at Rs177.5 and Rs179 at 4:30pm PST.