KARACHI: The rupee continued to take a beating against the dollar on Wednesday, amid shortage of the greenback in the country, besides deteriorating macroeconomics of Pakistan, dealers said.
The exchange rate witnessed a loss of 74 paisas to reach Rs239.65 against the dollar from the previous days’ closing of Rs238.91 at the interbank exchange market.
The analysts said that the local unit remained under pressure due to mounting demand for the foreign currency for import payments besides a surge in the value of the dollar against major currencies.
The announcement by the Saudi Fund for Development (SFD) for the rollover of the deposits failed to support the rupee in the interbank foreign exchange market.
The SFD has confirmed a rollover of a $3 billion deposit maturing on December 05, for one year. The deposit is placed with the State Bank of Pakistan (SBP) and is part of its foreign exchange reserves.
The rupee has witnessed a continuous depreciation against the greenback even after the inflows received from the International Monetary Fund (IMF) under the Extended Fund Facility (EFF) programme.
The country’s current account and trade deficit are expected to widen further as the government is moving to import essential food items. The industrial activities have also been badly disrupted which will massively impact the exports of the country.
Pakistan’s trade deficit swelled 31 per cent on a month-on-month basis to hit $3.5 billion, data by the Pakistan Bureau of Statistics (PBS) showed.
According to data released by PBS, the petroleum group imports registered a 29.93 per cent growth in August 2022 on a month-on-month basis to stand at $1.86 billion compared with $1.43 billion in July 2022.
Pakistan’s petroleum group imports witnessed a growth of 6.97 per cent during the first two months (July-August) of the fiscal year 2023 and stood at $3.30 billion, compared with $3.08 billion during the same period of last fiscal year.
Likewise, the foreign exchange reserves of the country have also recorded a decline on the back of less inflows and higher imports.
The foreign exchange reserves held by the State Bank of Pakistan (SBP) fell $176 million to reach 8.62 billion during the week ended September 9, compared with $8.79 billion on September 2.
The overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $14.31 billion. The net reserves held by banks amounted to $5.69 billion.
The country’s current account deficit rose 531 per cent to over $17 billion during the fiscal year 2022 due to massive increase in goods import bill. Overall, the current account deficit was $17.4 billion during the fiscal year 2022, compared with $2.8 billion in the fiscal year 2021, depicting an increase of $14.6 billion.
The local currency remained under pressure since the start of the current fiscal year. The rupee lost Rs34.8 or 16.98 per cent from Rs204.85 to dollar on June 30, 2022 to the current level of Rs239.65.
At the open market, the buying and selling of the dollar was recorded at Rs242.5 and Rs244.8 at 4:45pm PST.
