The free-fall in Pakistani Rupee (PKR) continued for 7th straight day against dollar on Monday as the US dollar jumped to Rs229.82 in interbank foreign exchange market.
The exchange rate recorded a decline of Rs1.64 in rupee value to end at Rs229.82 to the dollar from last Friday’s closing of Rs228.18 in interbank foreign exchange market.
The rupee has witnessed a continuous depreciation against the greenback even after the inflows received from the International Monetary Fund (IMF). The local currency has recorded Rs11.22 against the foreign currency during the past seven sessions. The local unit was at Rs218.60 to the dollar on September 01, 2022.
It is worth mentioning that Pakistan received $1.1 billion from the IMF under Extended Fund Facility (EFF) on August 31, 2022 following the executive board of the IMF approved the loan program on August 29, 2022.
Currency experts said that the rupee was under immense pressure due to high import payment demand and losses to the economy due to floods.
They said that high import payments by end of this quarter and corporate payments put pressure on the rupee value.
The rupee fell to the record low of Rs239.94 to the dollar on July 28, 2022.
The rupee made some recovery against the greenback after the IMF fund was transferred to the State Bank of Pakistan (SBP). However, the removal of sanction on import of luxury and non-essential items the rupee again started free fall.
The currency experts said that although the IMF inflows would help the further inflows under bilateral and multilateral sources. However, the devastation of floods has changed the economic environment scenario.
The torrential rains and flash floods have inflicted a loss of $10 billion to Pakistan’s economy. The devastation will prompt the country to make imports in the coming days, especially for agriculture products. The rupee also fell due to continuous depletion in foreign exchange reserves of the country.