- The rupee violates another important threshold of 195 in interbank market.
- Closes at 195.74 against U.S. dollar in interbank market.
- Dealers say the government’s reluctance to withdraw subsidies is making things worse.
KARACHI: Pakistani rupee continues to fall against United States dollar, breaking another important threshold of 196 interbank market to hit his weakest level on Tuesday.
Maintaining a recession for For the eighth working day in a row, the Pakistani rupee traded at Rs 195.74. against dollar outperforms last day record short of Rs 194.18.
Constant Delay in receipt of in next tranche of $1 billion from the International Monetary Fund (IMF) adds pressure on rupee.
The situation is most likely remain uncertain for local currency, said AA Commodities director Adnan Agar, speaking to Geo.tv how the local block fell below 196 points against dollar within trading session today.
“If a government decides to abolish subsidies on oil products, the rupee will jump back”, he said, adding that the local unit would remain inside range of 180-185.
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Agar, however added what if government I decided dissolve assembly and move to early elections situation for in already falling currency market will get worse.
At first of this fiscal year (July 1, 2021) the Rupee has collectively fallen by 24.24% (or Rs 38.2) to date compared to the previous financial period. year closed at Rs 157.54.
The ruble kept its downward trend for in last 13 months. To date, it has lost 28.54% (or Rs 43.47) compared to the previous year. record high of Rs 152.27 recorded in may 2021.
Taking into account Negotiations with the IMF are scheduled for begin tomorrow (May 18) analyst said that if government announces early elections, the IMF program will be stopped or if government decided to keep the subsidy on petroleum products against IMF conditions, the currency will fall even more.
Agar argued that even if the currency appreciates in nearest run on in back of in decision accepted coalition government towards the end of fiscal year 2022-23 rupee will slowly and gradually creep back to current levels because the extension current account deficit one of main problems of Pakistan.
Sharing similar views, other foreign exchange dealers said the government’s unwillingness to withdraw subsidies in line with the deal with The IMF is making things worse.
This worth mentioning that since PTI is led by government was forced out through vote of no-confidence on April 10, g. dollar was valued at Rs 182.93 and since then the Rs has lost Rs 12.8 or 7%. of its meaning.
Prime Minister Shehbaz held a meeting with currency dealers
A day earlier, Prime Minister Shehbaz Sharif held online meeting with Association of Stock Companies of Chairman of Pakistan (ECAP) Malik Bostan, where he was informed that trade deficit, delay in tranche of a loan from the IMF, political instability and excessive borrowing were the reasons for devaluation of the rupee.
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“Importers open more Letters of Credit (LC), while the inflow of exporters is low, due to which demand in interbank market increased, while the supply decreased,” Bostan said. in in online meeting with prime minister.
“The listed companies do not increase dollar rates and dollar rate in freedom market can not be reduced before rate in interbank market is an reduced.”
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