KARACHI: The Pakistani rupee experienced a minor depreciation against the US dollar on Wednesday, declining by nine paisas in the interbank market. The rupee closed at Rs157.13 against the dollar, compared to the previous day’s closing rate of Rs157.04.
Currency experts attributed the slight fall of the rupee to rising international oil prices. Pakistan, being a significant importer of oil, faces increased pressure on its foreign exchange reserves when global oil prices surge. This, in turn, escalates the demand for the US dollar, affecting the rupee’s stability.
“The market sentiments were dampened by the recent spike in global oil prices, which created a demand for foreign currency to finance these imports,” said a senior currency dealer. “Since oil is a critical import for Pakistan, any fluctuation in its price has an immediate impact on the rupee’s exchange rate.”
Despite the rupee’s depreciation, market participants expressed cautious optimism about its performance in the days ahead. Positive expectations are driven by anticipated inflows from workers’ remittances and export earnings, which are likely to provide much-needed support to the rupee.
“While the rupee faced some pressure today, the outlook remains positive,” a dealer noted. “With remittance inflows from overseas Pakistanis and earnings from exports expected to strengthen in the coming days, the rupee could recover some of its lost ground.”
This development highlights the rupee’s vulnerability to external shocks, especially those stemming from global oil price movements. As one of Pakistan’s largest imports, oil significantly influences the demand for foreign exchange. Consequently, any surge in prices directly impacts the rupee, posing challenges for the country’s economy.
The government and the central bank continue to monitor the situation closely, aiming to maintain stability in the foreign exchange market. However, sustainable measures to mitigate the rupee’s exposure to such external pressures remain critical for long-term stability.
With the rupee under pressure, the coming weeks will be crucial in determining its trajectory, influenced by global market trends and domestic economic developments.