KARACHI: The Pakistani rupee showed a slight downward movement on Saturday, as the market witnessed a dull session ahead of Eid-ul-Fitr holidays, dealers said.
The local unit fell 6 paisas to close at Rs185.69 to the dollar from the previous day’s closing of Rs185.63 in the interbank foreign exchange market.
The dealers said the local currency remained stable amid reduced demand for the dollar from the importers before Eid and it is expected to remain stable till the end of the Eid holidays.
The record workers’ remittance during March has also provided support to the local currency as the expatriates sent money to their families for Eid shopping and other expenses.
However, the depleting forex reserves continue to remain the biggest challenges to the stability of the rupee.
The country’s foreign exchange reserves fell by $377 million in the week ended on April 23. The total liquid foreign reserves held by the country stood at $16.668 billion, compared with $17.045 billion in the previous month, the State Bank of Pakistan (SBP) said.
The reserves held by the State Bank of Pakistan declined by $328 million to $10.558 billion on external debt and other payments, the central bank added.
The local currency hit the historic low of Rs188.18 on April 7, as the country faced the worst political crisis resulting in uncertain economic conditions.
The ballooning current account deficit is another reason for escalation in the dollar value. Pakistan’s current account deficit ballooned to $12 billion during the first eight months (July – February) 2021/22 against a surplus of $994 million in the corresponding months of the last fiscal year.
The local currency remained under pressure since the start of the current fiscal year. The rupee lost Rs28.15 or 17.86 per cent from Rs157.54 to dollar on June 30, 2021 to the current level of Rs185.69.
At the open market, the buying and selling of the dollar was recorded at Rs185.9 and Rs186.9 at 4:00pm PST.