Xinhua
12 May 2022, 09:00 GMT+10
The Pakistani rupee has depreciated against the greenback since May last year, and the devaluation of the Pakistani rupee against the U.S. dollar continued as the greenback touched a historic high of 190.02 rupees in interbank trading on Wednesday, according to the latest figures from the State Bank of Pakistan (SBP).
by Misbah Saba Malik
ISLAMABAD, May 12 (Xinhua) -- Devaluation of the Pakistani rupee against the U.S. dollar continued as the greenback touched a historic high of 190.02 rupees in interbank trading on Wednesday, according to the latest figures from the State Bank of Pakistan (SBP).
The U.S. dollar closed at 188.66 rupees on Tuesday and opened higher on Wednesday after the local currency devalued by 1.36 rupees, or about 0.72 percent, the official figure showed.
The Pakistani rupee has depreciated against the greenback since May last year when it started surging from 152.27 rupees.
Local analysts believed that multiple factors including the government's failure to secure a bailout package from the International Monetary Fund (IMF), subsidy on fuel, surging imports, and falling exports are the main causes of the nosedive of the local currency against the U.S. dollar.
In a conversation with Xinhua, Sajid Ameen Javed, a renowned economist and deputy executive director at an Islamabad-based think-tank Sustainable Development Policy Institute, said that uncertainty regarding the IMF program is the major reason for panic in the market and pressure on the Pakistani currency.
According to the SBP, its reserves declined 59 million U.S. dollars to 10.5 billion dollars at the end of last month. The country is also facing a serious challenge in its foreign exchange reserves, which fell by 115 million dollars at the end of April, due to surging external debt payments and a higher current account deficit, official figures from the central bank showed.
Citing the bank's figures, Javed said that an urgent bailout package from the foreign donor is very important to provide a cushion to the economy and boost the confidence of investors and exporters.
He said that the demand for the U.S. dollar has also increased in the market after Eid holidays due to pending payments of imports to the international markets.
"The hesitation of the recently elected collation government to take bold decisions including removal of fuel subsidy accounting for 150 billion Pakistani rupees a month, which is a major deadlock between the finance ministry and the IMF, is also contributing to pressure on the local currency," he added.
The stock market is also in a worse condition and has lost 641 points on Wednesday, two days after losing 1,447.67 points during trading, he said, adding that the market has sent shockwaves to the currency market, putting pressure on the rupee.
The increase in the greenback's price has also triggered a new wave of inflation in the country with prices of all commodities ranging from food to other necessities increasing.
According to a recently available report of the Pakistan Bureau of Statistics released on May 2, inflation in the country, measured by the Consumer Price Index, was recorded as 13.37 percent in April, the highest in two years.
Get a daily dose of Manila Metro news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Manila Metro.
More InformationBRISBANE, Queensland, Australia - Two French girls barely out of high school remain behind bars after their arrival into Australia's...
Canberra [Australia], July 13 (ANI): Australia's Minister of Foreign Affairs Penny Wong has announced 34 recipients of this year's...
(250713) -- MINFENG COUNTY, July 13, 2025 (Xinhua) -- Staff members work on the final section of the 750-kilovolt (kV) loop in Minfeng...
Houston [US], July 13 (ANI): IAF Group Captain Shubhanshu Shukla, the first Indian astronaut to visit the International Space Station...
By Vishu Adhana Beijing [China], July 13 (ANI) External Affairs Minister S Jaishankar will arrive in Beijing on Sunday evening,...
Singapore City [Singapore], July 13 (ANI): External Affairs Minister S Jaishankar held a meeting with his Singapore counterpart Vivian...
DUBAI, U.A.E.: A cargo ship flagged under Liberia, known as the Eternity C, sank in the Red Sea following an attack executed by Yemen's...
WASHINGTON, D.C.: The Trump administration has started sending some weapons to Ukraine again, just a week after the Pentagon told officials...
ECAULT BEACH, France: On clear days, the white cliffs of the United Kingdom, are visible from northern France, where men, women, and...
ATLANTA, Georgia: The United States is facing its worst measles outbreak in more than three decades, with 1,288 confirmed cases so...
In the past month alone, 23 Israeli soldiers have been killed in Gaza—three more than the number of remaining living hostages held...
LONDON, U.K.: At least 13 people are believed to have taken their own lives as a result of the U.K.'s Post Office scandal, in which...