KARACHI: The US dollar hit fresh record high of Rs200.93 against the Pakistan Rupee (PKR) on Monday as political noise louder following an announcement of a mass-rally against the collation government led by PML-N.
The exchange rate witnessed a loss of 79 paisas in rupee value against the dollar to end at Rs200.93 from last Friday’s closing of Rs200.14 in interbank foreign exchange market.
Analysts said that the political uncertainty caused further depreciation in rupee as former Prime Minister Imran Khan a day earlier announced a long march on May 25, 2022 against the present government.
The PML-N led government came to power after former Prime Minister Imran Khan was removed from the executive post after vote of confidence on April 10, 2022.
The present government inherited with serious economic challenges including falling foreign exchange reserves and ballooning current account deficit.
The rupee lost Rs16.25 or 8.8 per cent in 1 ½ months from Rs184.68 on April 08, 2022 to the present level of Rs200.93 on May 23, 2022.
Last week the government announced to impose a complete ban on imports to support balance of payment and help rupee to stable. However, these measures appeared in failure as the exchange rate yet again deteriorated today massively.
Currency experts said that massive fall in foreign exchange reserves and high import payments were the major reasons behind rupee fall.
Pakistan’s foreign exchange reserves fell to $16.161 billion by the week ended May 13, 2022. The foreign exchange reserves of the country were $16.373 billion by week ended May 6, 2022.
The country’s foreign exchange reserves hit record high at $27.228 billion by the week ended August 27, 2021. Since then the foreign exchange reserves have depleted by $11.067 billion.
The official reserves of the State Bank witnessed a decline of $146 million to $10.163 billion by the week ended May 13, 2022 as compared with $10.309 billion a week ago.
The SBP reserves reached a record high at $20.145 billion by August 27, 2021. The official reserves also fell by around $10 billion after reaching record high. The official reserves of the SBP have been reduced to provide import payment cover for only 1.50 months.
The import bill of the country surged by 46.41 per cent to $65.49 billion during the first 10 months of the current fiscal year as compared with $44.73 billion in the corresponding months of the last fiscal year.
Pakistan is a net importer of petroleum products to meet its domestic demand. The country’s oil bill was $14.81 billion during the first nine months (July – March) 2021/2022 as compared with $7.55 billion in the corresponding period of the last fiscal year, showing a massive growth of 96 per cent. The oil bill is around 25 per cent of the total import bill of the country.