Dollar hits new peak of Rs176.77

KARACHI: The dollar recorded a new high of Rs176.77 against the Pakistani rupee at the interbank foreign exchange market on Friday.

The dollar made fresh high as against the last day closing of Rs176.42, which was the previous record high of the greenback.

The dealers said that the rupee deteriorated further because of escalation in import bill for the month of November 2021 and deceleration of official foreign exchange reserves of the country.

The official reserves of the State Bank fell $244 million to $16.01 billion by the week ended November 26, 2021, compared with $16.254 billion a week ago. Analysts at Topline Securities said with imports of around $8 billion in a month, the import cover has reduced to two months as against 3.3 months in August 2021.

The official data of the Pakistan Bureau of Statistics (PBS) released on Thursday, showed the import bill of the country surged 69.17 per cent to $33 billion during the first five months (July-November) 2021/22, compared with $19.47 billion in the corresponding months of the last fiscal year.

The large imports also widened the trade deficit sharply. The trade deficit during the months under review widened 112 per cent to $20.59 billion, compared with the deficit of $9.72 billion in the corresponding period of the last fiscal year.

The exports of the country also grew at 27 per cent but much lower than the pace in growth of the import bill during the period under review. The exports of the country increased to $12.34 billion during July-November 2021/22, compared with $9.74 billion in the same period of the last fiscal year.

According to a poll, the rupee may fall further next year, as the participants see the local unit around Rs180 to Rs185 against the dollar.

The market was expecting a recovery in the rupee value; following the hike in the policy rate and signing of agreement between the SBP and Saudi Development Fund (SDF) for placement of $3 billion with the State Bank of Pakistan.

However, the large imports offset the efforts of the State Bank and development on the external front.

The rupee remained under pressure since the start of the current fiscal year. The local currency fell Rs19.23, or 12.21 per cent, from June 30, 2021 closing of Rs157.54 to the closing of Rs176.77 on December 3, 2021.

In the open market, the buying and selling of the dollar has been recorded at Rs177.75/Rs179.25 at the time of filing of this report.

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