ISLAMABAD: The Pakistani plummeted to an all-time low of Rs298.91 against the US dollar during Thursday’s trading in the interbank market as the cash-starved country struggles to arrange funds to make payments to international lenders amidst depleting foreign exchange reserves, which have become a source of consternation for investors.
The local currency lost approximately 3% of its value, or Rs8.69, as of 1:15 pm.
The sharp loss follows the rupee’s Wednesday interbank market closing at Rs 290.22 against the US dollar.
The arrest of Pakistan Tehreek-e-Insaaf chief and former prime minister Imran Khan has further added fuel to the fire as deadly rioting in Pakistan has exacerbated instability during a severe economic crisis as the country struggles to unlock the crucial International Monetary Fund (IMF) funding.
PTI protesters have gone berserk after the arrest of Khan with his supporters ransacking property and attacking key military installations.
PTI protesters have attacked and set on fire state property and assets in various cities. The violence has claimed the lives of at least five people in the last three days.
According to Zafar Paracha, General Secretary of the Exchange Companies Association of Pakistan (ECAP), “the ongoing political uncertainty is fueling depreciation in the market.”
But with the money at hand, he added, “This shouldn’t be the case.”
The currency dealer claimed that market participants take advantage of such happenings to make money.
He urged authorities to pay attention to such happenings, saying, “We have not seen such financial uncertainty in decades.”
Globally, the US dollar sank for a second day against the yen on Thursday, feeling the pressure from lower US Treasury yields after slowing inflation gave traders more confidence than the Federal Reserves.
The dollar index, which compares the worth of the dollar to a basket of six important currencies, including the yen, decreased 0.05% to 101.36.
The world’s leading oil user, the United States, reported higher fuel consumption on Thursday, which helped oil prices, a crucial indicator of the value of currencies, recovering from a day earlier when they had fallen by more than a dollar per barrel.
