Rupee softens against dollar to PKR 224.71 in interbank

Rupee softens against dollar to PKR 224.71 in interbank

KARACHI: Pakistani Rupee (PKR) softened against the US dollar on Wednesday to end at PKR 224.71 in the interbank foreign exchange market.

The exchange rate recorded ease in rupee value to end at PKR 224.71 from previous day’s closing of PKR 224.70 in the interbank foreign exchange market.

READ MORE: PKR steady fall continues against dollar in interbank

Currency experts said that the local currency was under immense pressure due to dollar demand for high import and corporate payments.

However, they said that tight monitoring of the central bank regarding dollar movement helped the rupee to witness lesser depreciation.

The experts further said that falling foreign exchange reserves also impacting adversely the exchange rate.

READ MORE: PKR weakens by 25 paisas to dollar on foreign payment demand

Pakistan’s official foreign exchange reserves have plunged to multi years low to $6.72 billion by week ended December 02, 2022. The official reserves of State Bank of Pakistan (SBP) fell by $784 million to $6.715 billion by week ended December 02, 2022 when compared with $7.499 billion a week ago i.e. November 25, 2022. Previously, the SBP reserves were seen at $7 billion in April 2014.

The central bank said that during the week ended December 02, 2022, SBP reserves decreased by $ 784 million to $ 6,714.9 million.

READ MORE: Rupee eases against dollar amid sharp decline in forex reserves

This decline is on account of the payment of $1,000 million against maturing Pakistan International Sukuk and some other external debt repayments.

Some of the debt repayments were offset by inflows, mainly $500 million received from Asian Infrastructure Investment Bank (AIIB), the SBP added.

Last week the chief of the central bank made a statement regarding foreign payments to be made by the country.

READ MORE: PKR devaluation against dollar continues despite strict monitoring

SBP Governor Jameel Ahmad said that the country will continue to make timely repayments while inflows are expected to increase significantly in the second half of the current fiscal year.

He said, for the fiscal year 2023, around $33 billion were to be repaid to external stakeholders, including the Current Account Deficit (CAD) of $10 billion and $23 billion in loan repayments.

Out of the payable $23 billion external debt, Pakistan has already repaid more than $6 billion whereas as a bilateral loan of $4 billion has been rolled over with the cooperation of relevant countries.