KARACHI: The Pakistani rupee continued to remain under pressure against the dollar on Friday on the back of narrowing foreign exchange reserves and a likely increase in the import bill, dealers said.
The exchange rate witnessed a loss of 5 paisas against the dollar to reach Rs218.43 from the previous day’s closing of Rs218.38 in the interbank foreign exchange market.
Currency experts said that the local unit fell for the third consecutive session owing to bleak economic figures which have dented investors’ confidence.
The foreign exchange reserves of the country have declined to an alarmingly low level amid interest and import payments while the government is likely to move for imports of essential items amid destruction caused by the floods, they added.
The foreign exchange reserves held by the State Bank of Pakistan (SBP) were down $303 million to clock-in at $7.59 billion during the week ended October 7, compared with $7.89 billion on September 30.
The overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $13.24 billion. The net reserves held by banks amounted to $5.64 billion.
According to the central bank, the drop came due to external debt repayments, which included repayment of a commercial loan and interest payment on Eurobonds.
The workers’ remittances by overseas Pakistanis slowed down to a four-month low at $2.44 billion in September 2022. The receipts contracted 10.5 per cent in September, compared with the inflows of $2.72 billion in the previous month.
On the inflows front, the Asian Development Bank (ADB) on September 5, announced it would provide aid of around $2.5 billion for relief operations in the wake of devastating floods that have caused catastrophic damage in Pakistan.
The country is also expected to receive around $1 billion from the United Nations (UN) and $1 billion from the World Bank during a period between October and December.
The trade deficit of Pakistan recorded a decline of 21.42 per cent to clock-in at $9.2 billion in the first quarter of the fiscal year 2023, compared with that of $11.7 billion recorded during the same period of fiscal year 2022.
The total imports during the first quarter stood at $16.3 billion, compared with $18.71 billion recorded during the same period of last fiscal year. The exports rose to $7.1 billion, from $6.99 billion in the first quarter of last year.
The local currency remained under pressure since the start of the current fiscal year. The rupee lost Rs13.58 or 6.62 per cent from Rs204.85 to dollar on June 30, 2022 to the current level of Rs218.43.
At the open market, the buying and selling of the dollar was recorded at Rs220.5 and Rs222.5 at 5:00pm PST.
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