KARACHI: Pakistani Rupee (PKR) on Wednesday lost 56 paisas against the dollar in the interbank foreign exchange market.
The exchange rate recorded a decline of 56 paisas in rupee value to end at PKR 282.85 in the interbank foreign exchange market as compared with previous day’s closing of PKR 282.29 in the interbank foreign exchange market.
READ MORE: Rupee registers another day of erosion; dollar ends at PKR 282.29
Currency experts said that dollar demand was remained high for payment of goods related to holy month of Ramazan.
They said that goods clearance had seen an acceleration as about a week to go for the start of the holy month.
Experts further said that delay in IMF loan program had also pressured the rupee value. Besides, the local unit was also under pressure due to political and economic instability.
READ MORE: Rupee weakens against dollar to end at PKR 281.61 in interbank
The local currency has registered a continuous fall during past few days and heading towards the all-time low. The rupee recorded historic low of PKR 285.09 to the dollar on March 02, 2023.
Previously, the local currency had seen improvement in value due to rising foreign exchange reserves. The experts however said that the foreign exchange reserves were still very low.
READ MORE: Rupee strengthens against dollar to reach PKR 280.77 in interbank
Foreign exchange reserves of the State Bank of Pakistan (SBP) have been increased to a level for providing more than one month import cover, according to official data released last week.
The official reserves of the SBP increased by $487 million to $4.301 billion by week ended March 03, 2023 as compared with $3.814 billion a week ago i.e. February 24, 2023.
READ MORE: Rupee witnesses big fall against dollar to end PKR 282.30 in interbank
The SBP attributed the rise in its official reserves to inflows of $500 million as commercial loan from China.
After many week the official reserves of the central crossed one month import cover. The import bill of the country during the month of February 2023 was recorded at $4 billion.
Ideally a central bank should have a level of foreign exchange reserves that is equal to three-month of import payment by a country.
The foreign exchange reserves held by the central bank witnessed a record high at $20.146 billion by the week ended August 27, 2021. Since then the official reserves of the SBP dropped by $15.845 billion.