Dollar advances to new peak of Rs178.15

KARACHI: The dollar recorded a new high of Rs178.15 on Wednesday, amid higher year-end dollar demand for import and corporate payments, dealers said.

The exchange rate witnessed a 10 paisas decline in the rupee value against the dollar from yesterday’s closing of Rs178.05, the previous historic low of the rupee, in the interbank foreign exchange market.

The dealers said the dollar demand remained high due to the year-end import and corporate payments.

They said the large current account deficit and trade deficit had worsened the market sentiment.

Pakistan’s current account deficit has ballooned to $7 billion during the first five months (July-November) 2021/22. The current account posted a surplus of $1.87 billion in the same period of the last fiscal year, according to the balance of payments data released by the State Bank of Pakistan (SBP) on Tuesday.

The widening of the current account deficit was due to a sharp rise in the import bill. The import bill grew 69.57 per cent to $33 billion during the first five months of the current fiscal year, compared with $19.46 billion in the corresponding period of the last fiscal year, according to the data released by the Pakistan Bureau of Statistics.

The trade deficit widened 112 per cent to $20.65 billion during the period under review, compared with the deficit of $9.72 billion in the same period of the last fiscal year.

The recent measures taken by the State Bank of Pakistan (SBP) yet again failed to support the rupee.

The SBP on December 19, 2021 imposed restrictions on foreign exchange buying by individuals from the open market to discourage speculative gains.

The rupee remained under pressure since the start of the current fiscal year. The local currency fell Rs20.61, or 13.08 per cent, from June 30, 2021 closing of Rs157.54 to the closing of Rs178.15 on December 22, 2021.

However, in the open market, the buying and selling of the dollar was recorded at Rs178.60/Rs180.40 at 3:45pm PST.

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