Rupee breaches 202 a dollar barrier in interbank

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KARACHI
The Pakistani rupee continued its losing spree and fell to new all-time low of 202.01 against the US dollar on Thursday amid failure of talks between the government and the International Monetary Fund (IMF) for revival of loan programme.
The local currency has been setting all-time new lows for the last 13 sessions. The State Bank of Pakistan said in a statement that the dollar opened at Rs201.92 in the interbank market and closed at Rs202.01 after losing 9 paisas (-0.04 percent). Within the open market, the rupee was traded at 203/204 per dollar against 202.5/203.5 a dollar a session earlier.
The local unit shed Rs1.87 during the last four session after losing Rs13.51 during the previous two weeks. Overall, the rupee has depreciated by Rs44.52 against the US dollar during the ongoing fiscal year 2021-22 and Rs25.70 during the current year 2022.
Pakistan and the IMF failed to reach a staff-level agreement for the revival of the $6 billion programme as the Fund emphasised the “urgency of concrete policy actions, including removing fuel and energy subsidies.” The IMF assistance has been stalled since a disagreement with the previous government over energy subsidies in February 2022.
Pakistan is facing a fast depletion of foreign exchange reserves and analysts have been warning that the country is at risk of defaulting on its external debts. The country needs foreign inflows to bolster its forex reserves, which have fallen to $10.2 billion, enough to meet the cost of fewer than two months of imports.
Saudi Minister of Finance Mohammed al-Jadaan said on Tuesday that Saudi Arabia is finalising the extension of the kingdom’s $3 billion deposit to Pakistan. “We are currently finalising extending the $3 billion deposit to Pakistan,” he added. Last year, Saudi Arabia deposited $3 billion in Pakistan’s central bank to help support its foreign reserves.
The currency experts said that until IMF resumes its programme, the economic situation will not improve. They said that importers have been engaged in panic buying as they are uncertain about whether or not the government will be able to secure funding from foreign institutions, while exporters have held their earnings outside the country amid a consistent fall in the rupee’s value.