PKR slides by 82 paisa against USD

October 18, 2022 (MLN): The Pakistani rupee (PKR) depreciated by 82 paisa against the dollar on Tuesday due to melting foreign exchange reserves, political turbulence, and weak macros. At the close of today's trade, the currency closed at PKR 219.71 against PKR 218.89 from the previous session.

During the session, the rupee traded in a range of 85 paisa per USD showing an intraday high bid of 219.75 and an intraday low offer of 219.65 while in the open market, PKR was traded at 224/226.50 per USD.

While speaking to MG Link News, Malik Bostan Chairman of Forex Association said that the government’s failure to make the rupee stable against the greenback will lead the country toward a financial crisis.

“During times when the economy is in doldrum and political chaos is playing its due share to hit the market sentiments, the government should review the trade policy”, he added.

Further, he highlighted that as of now all importers are paying import bills in dollars and he suggested that to save the reserves country should trade in local currency with Afghanistan, Iran, and other countries.

In addition to letters of credit, smugglers are also paying in dollars, causing the gap between interbank and open market rates to widen.

Also, he gave the example of Russia trading in local currency during economic sanctions to save its reserves and nearly every country is changing its trade policy in order to prevent a financial crisis.

Meanwhile, the currency lost 2.5 rupees to the Pound Sterling as the day's closing quote stood at PKR 249.11 per GBP, while the previous session closed at PKR 246.62 per GBP.

Similarly, PKR's value weakened by 3 rupees against EUR which closed at PKR 216.39 at the interbank today.

On another note, within the money market, the State Bank of Pakistan (SBP) conducted an Open Market Operation (OMO) in which it injected Rs207.8 billion for 3 days at 15.20%.

The overnight repo rate towards the close of the session was 15.00/15.25%, whereas the 1-week rate was 15.25/15.35%.

Copyright Mettis Link News