In a worrisome turn of events, the Pakistani rupee has continued its steady descent, hitting a new record low against the US dollar and raising concerns among economic analysts and policymakers. The local currency settled at Rs303.05 in the inter-bank market on Tuesday, marking a significant drop from its previous standing.
According to the State Bank of Pakistan (SBP), the rupee experienced a decline of Rs1.05 or 0.35 per cent by the time the market closed on Tuesday. This decline follows closely on the heels of Monday’s record low, where the rupee closed at Rs302 against the US dollar.
This decline is followed by the recent agreement secured with the International Monetary Fund (IMF). While this arrangement was expected to bring some stability to the currency, the rupee has instead faced renewed pressure.
Falling foreign exchange inflows have posed a challenge, causing unease among financial circles. Moreover, apprehensions have grown due to a widening current account deficit, a situation exacerbated by the lifting of import restrictions by authorities.
The international scene has also played a part in this precarious situation. On the global stage, the US dollar showed signs of hesitancy on Tuesday, as traders demonstrated caution by refraining from significant bets ahead of a series of anticipated economic data releases throughout the week. Meanwhile, the Japanese yen found itself grappling with levels that had triggered intervention in the past year.
With multiple factors at play, including IMF negotiations, foreign exchange dynamics, and global economic trends, the coming days will likely prove crucial in determining the rupee’s trajectory and Pakistan’s economic landscape.
