The Pakistani rupee dropped against the US dollar for the sixth straight session on Wednesday, losing 0.53 per cent in the inter-bank market.

According to the State Bank of Pakistan (SBP), the local currency dropped by Rs1.17, or 0.53 per cent, to close at Rs220.88. In the last six trading sessions, the rupee has lost Rs3.09, or 1.4 per cent, of its value overall.

The rupee lost value against the US dollar on Tuesday for the fifth consecutive session, closing at Rs219.71 after losing Rs0.82 (0.37 per cent).


According to market analysts, the local currency’s weakness is caused by declining reserves and a lack of evidence of foreign capital inflows.

In an interview with Bloomberg, Finance Minister Ishaq Dar said that the rupee has been “heavily undervalued”.

“It is due to speculation – and some players in the market have been responsible for that,” he added.

Globally, the greenback hung close to a 32-year peak versus the yen on Wednesday while edging up from a two-week trough against a basket of major peers as traders weighed improved risk sentiment against the prospect of aggressive Federal Reserve rate hikes.

The dollar index – which measures the currency against six peers including the yen, sterling and euro – edged up to Rs112.01, after dropping to the lowest since October 6 at Rs111.76 overnight.

On Wednesday, oil prices increased marginally despite bearish factors like unclear Chinese demand growth and falling gas costs, which were offset by bullish factors like declining crude stocks and a generally undersupplied market.