Rupee free-fall continues; dollar jumps to new high

KARACHI: No letup was witnessed in the rupee free-fall, as the dollar jumped to new record high of Rs177.61 on Thursday in the interbank foreign exchange market, dealers said.

They said the rupee deteriorated due to the expected large deficit of the current account and rising dollar demand for import payments.

The exchange rate witnessed another loss of 18 paisas in the rupee value against the dollar to end at Rs177.61 from the last day’s closing of Rs177.43, which was previous record low of the rupee.

The dealers said the lack of positive news from the external front regarding inflows maintained the panic buying for the dollars.

The dealers said all the measures taken by the central bank to support the local currency yielded no results.

Last week, the Saudi Development Fund (SDF) placed an amount of $3 billion with the SBP to support Pakistan to manage the balance of payments position. However, during the current week, the dollar demand remained buoyant.

They said the large import bill is keeping the rupee under pressure.

According to the official data of the Pakistan Bureau of Statistics (PBS), 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.

To support the rupee, the government is considering measures to curtail imports. The dealers said the government should take concrete steps to discourage import of luxury and non-essential items.

The rupee remained under pressure since the start of the current fiscal year. The local currency fell Rs20.07, or 12.74 per cent, from June 30, 2021 closing of Rs157.54 to the closing of Rs177.61 on December 8, 2021.

In the open market, the buying and selling of the dollars was recorded at Rs178.50/Rs180.25 at 3:15PM PST.

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