The US dollar surged to an all-time high against the Pakistani rupee, reaching Rs153 during midday trading on Thursday. This significant increase is attributed to weak economic indicators, which have placed considerable pressure on the local currency.
The dollar’s value climbed by Rs1.44 against the rupee compared to the previous day’s closing rate of Rs151.56 in the interbank foreign exchange market. The continuous devaluation of the rupee is raising concerns among economists and financial analysts about the stability of Pakistan’s economy.
Currency dealers highlighted that the scheduled repayment of foreign loans has significantly increased the demand for the greenback. Pakistan’s obligation to service its external debt is one of the primary factors driving the surge in demand for US dollars. This, coupled with the country’s ongoing economic challenges, has exacerbated the situation, causing the rupee to depreciate further.
“The persistent pressure on the rupee is largely due to the weak economic indicators,” said a senior currency dealer at a leading exchange company. “The rising demand for the US dollar, driven by foreign debt repayments, has left the rupee vulnerable to further declines.”
Economic experts have expressed concerns over the widening trade deficit, which has been a key factor contributing to the rupee’s depreciation. Pakistan’s imports continue to outpace its exports, leading to a significant trade imbalance. The high import bill, particularly for essential commodities such as oil, has further strained the country’s foreign exchange reserves.
Additionally, the recent rise in global oil prices has intensified the pressure on Pakistan’s external account. The country heavily relies on imported oil to meet its energy needs, and the escalating oil prices have increased the import bill, necessitating more dollars for payments.
The State Bank of Pakistan (SBP) has been attempting to stabilize the rupee through various measures, including interventions in the foreign exchange market. However, these efforts have provided only temporary relief, as the underlying economic issues remain unaddressed.
The depreciation of the rupee has far-reaching implications for the economy. It increases the cost of imported goods, leading to higher inflation. This, in turn, affects the purchasing power of the general public, as prices of essential commodities rise. Moreover, the weakening rupee makes it more expensive for Pakistan to service its external debt, adding to the country’s financial burden.
Analysts believe that addressing the structural issues within the economy is crucial to stabilizing the rupee in the long term. Measures such as boosting exports, reducing the trade deficit, and attracting foreign investment are essential steps towards achieving a more stable exchange rate.
As the dollar continues to climb, the focus remains on how the Pakistani government and the SBP will navigate these economic challenges to restore confidence in the local currency and ensure sustainable economic growth.