KARACHI: The US dollar made new record against the Pakistani Rupee to reach at Rs220 during midday trading in interbank foreign exchange market on Tuesday.
The rupee has lost Rs4.8 so far during the day against the dollar. The exchange rate is at Rs220 to the dollar from previous day’s closing of Rs215.20.
READ MORE: Rupee plummets record low at Rs215.20 to dollar
The rupee fell to the record low of Rs215.20 at interbank closing on July 18, 2022.
Currency experts said that the local unit was under pressure due to political instability.
Furthermore, the Fitch rating agency has downgraded the Pakistan outlook to negative from positive.
READ MORE: Fitch revises Pakistan’s outlook to negative
The experts also believed that the falling foreign exchange reserves also putting pressure on rupee stability.
The foreign exchange reserves of Pakistan have depleted by $454 million to $15.742 billion by week ended June 30, 2022. The foreign exchange reserves of the country were at $16.196 billion a week ago i.e. June 24, 2022.
The country’s foreign exchange reserves hit all-time high of $27.228 billion on August 27, 2021. Since then the foreign exchange reserves have declined by $11.486 billion.
The official reserves of the State Bank also recorded a decline of $493 million to $9.816 billion by week ended June 30, 2022 as compared with $10.309 billion a week ago.
READ MORE: PKR slips to Rs210.95 against dollar despite IMF agreement
The central bank attributed the decline in foreign exchange reserves to external debt repayments.
It is pertinent to mention that the SBP received about $2.3 billion from Chinese banks for buildup of foreign exchange reserves. However, despite receiving the amount the external debt payment kept the pressure on the reserves.
The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by week ended August 27, 2021. Since then the official reserves of the SBP declined by $10.33 billion.
READ MORE: Rupee recovers 30 paisas to dollar on IMF agreement
The SBP on July 07, 2022 announced a hike of 125 basis points in policy rate to bring at 15 per cent. The purpose of increasing the interest rate was to curb the demand and support the rupee value. However, the effort of the SBP failed to support the rupee value.
