Pakistan's rupee extended its decline for a third successive session on Monday as depleting foreign exchange reserves and uncertainty over revival of the International Monetary Fund (IMF) programme mounted pressure on the local currency. Resultantly, rupee depreciated by 0.48% against the US dollar in the inter-bank market.
As per the State Bank of Pakistan (SBP), the rupee closed at 187.53 after a day-on-day fall of 90 paisas, or 0.48%. On Friday, the rupee had closed at 186.63 after a depreciation of 0.5%.
Following the recent depreciation, rupee is just 65 paisa away from its all-time low of 188.18 recorded on April 7, 2022.
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Oil prices, a major determinant of currency parity, slipped on Monday alongside equities and weighed down by a strong dollar and demand concerns on the back of continued coronavirus lockdowns in China, the world's top oil importer.
Arif Habib Limited Head of Research Tahir Abbas said uncertainty on the IMF front is the primary factor driving rupee’s depreciation against the greenback. Uncertainty over the programme also resulted in selling pressure in Pakistan stocks, which plummeted throughout the day as well.
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“According to preconditions, the global lender wants Pakistan to end the subsidy being given on oil and energy prices,” he said. “Moreover, friendly countries will also extend aid only when the IMF programme is revived.”
Inter-bank market rates for dollar on Monday
BID Rs 187.50
OFFER Rs 187.60
Open-market movement
In the open market, the PKR lost 1.50 rupees for buying and 2 rupees for selling against USD, closing at 188 and 189, respectively.
Against Euro, the PKR lost 1.50 rupees for both buying and selling, closing at 196.50 and 198.50, respectively.
Against UAE Dirham, the PKR lost 30 paisas for both buying and selling, closing at 50.70 and 51.10, respectively.
Against Saudi Riyal, the PKR lost 40 paisas for buying and 50 paisas for selling, closing at 49.50 and 49.90, respectively.
Open-market rates for dollar on Monday
BID Rs 188
OFFER Rs 189