The dollar reached its peak against the rupee on Monday, rising more than R194 on the interbank market, as analysts continue to express concern about the country’s rising bill.
According to the Pakistan Forex Association (FAP), the greenback earned Rs1.30 from around Friday to Rs194.30 around 11:30 am on inter-bank trading.
The development comes a week after the rupee hit low, largely due to rising foreign currency debt.
Last week’s data from FAP showed that the dollar had risen to record the rupee high for five consecutive days, with the international currency hitting up Rs188.66 on the interbank market last Tuesday, then rising to Rs190.90 on Wednesday. rose above R192 on Thursday and reached R193.10 on Friday.
When the PML-N coalition government took office on April 11, the dollar was worth R182.3. Since then, the rupee has lost Rs11.4 or 6.2 percent of its value.
FAP figures showed that the greenback closed at Rs193 at the end of Friday’s session. However, according to data released by the Pakistan State Bank (SBP), the dollar was stable at Rs192.53 at the end of the session.
According to a It was morning Reportedly, since the beginning of the current financial year on July 1, 2021, the rupee has lost 18.17pc of its value against the dollar.
The decline in the rupee is due to the uncontrolled increase in imports and the slow pace of export growth. This is reflected in the trade deficit, which reached $ 39 billion in July-April.
In the meantime, foreign exchange reserves have grossed $ 10.3 billion, the lowest since June 2020. Import insurance, which reflects the country’s ability to repay its foreign exchange purchases with international currency, is now declining to a minimum of 1.54 months.
Currency traders say the high demand for dollars is the main reason for the bullish trend in the currency market. The political drag on the ruling government over the reversal of petroleum and electricity subsidies – a requirement for the introduction of the International Monetary Fund (IMF) loan program – has also eroded stakeholder confidence.
FAP Chairman Malik Bostan said the government should “prevent unnecessary items and exports from importing foreign exchange”. In doing so, he said, the value of the dollar could be depreciated rapidly to R180.
Meanwhile, Pakistan Foreign Exchange Association Secretary-General Zafar Paracha said pressure on the rupee could continue until the expansion of the IMF loan program.
He also urged the government and the SBP to immediately stop imports and take steps to promote alternative fuels. He linked these measures to reducing the country’s import bill.