KARACHI: Taking cues from burgeoning import payments and uncertain geopolitical conditions, the Pakistani currency hit an all-time low of Rs178.98 against the US dollar in the inter-bank market on Monday.
The steep fall was attributed to the panic accumulation of dollars over fears that the supply of the greenback might reduce in the country due to the Russia-Ukraine conflict.
The local currency last dropped to an all-time low of Rs178.63 on March 9.
Pakistan-Kuwait Investment Company Head of Research Samiullah Tariq said that the currency is under pressure due to higher demand because of the geopolitical situation which has impacted the commodity prices.
He said: “The local currency is now showing signs of the impact of the recent commodity price hike witnessed in the international market.”
The rupee had maintained a downward trend for the past 10 months. It has lost 17.54% (or Rs26.71) to date, compared to the record high of Rs152.27 recorded in May 2021.
Endorsing his views, Arif Habib Limited Head of Research Tahir Abbas said that despite the slight correction in international oil prices, the Pakistani currency is still under pressure because the prices are still high.
“Rupee is incorporating the pressure of global oil prices,” he said, adding that because of this current account deficit is also expected to remain on the higher side.
The uptrend in international commodity prices suggests that Pakistan’s import bill would remain high going forward — which will keep the rupee-dollar parity towards the higher side.
With a fresh decline of 0.26%, the Pakistani rupee has depreciated by 13.6% (or Rs21.44) since the start of the current fiscal year on July 1, 2021, data released by the central bank revealed. –Agencies
