PKR depreciates further by 48 paisa against greenback

May 24, 2022 (MLN): Amid prevailing uncertainty, the Pakistani rupee (PKR) has further lost 48 paisa against US dollar in today's interbank session as the currency settled the session at PKR 201.41 compared to yesterday's closing of PKR 200.93 per USD.

During the session, PKR traded in a range of 1.8 rupees per USD showing an intraday high bid of 201.50 and an intraday low offer of 200.

Experts are of the view that Pakistan is in the dire need of an IMF tranche as the delay will result in a further decline in foreign exchange reserves. Meanwhile, the aggressive hike in policy rate by 150 basis points has also not been able to wipe off the panic from the market due to the absence of fiscal consolidation.

According to Asad Rizvi, the former Treasury Head at Chase Manhattan, “Delay in IMF tranche won’t help to stabilize PKR as outflow will deplete foreign exchange reserves.”

The truth is that the oil bill has triggered the slide and inflows have been clogged that need IMF nods, he added.

From July’21 to date, the local unit has lost Rs43.86 against the USD. Similarly, the rupee fell by Rs24.89 in CYTD, with the month-to-date (MTD) position showing a decline of 7.81%, as per data compiled by Mettis Global.

During the last 52 weeks, PKR lost 23.35% against the greenback, reaching its lowest at 201.41 today, and touched its high of 154.37 on May 25, 2021.

Furthermore, the local unit has weakened by 13.56% and 14.26%  against EUR and GBP, respectively since its high on July 02, 2021.

In addition, the performance of PKR remained bleak against major currencies in the month to date as it weakened by 9.63%, 9.41%, 8.87%, 7.87%, 7.81%, 7.81%, and 6.97% against JPY, EUR, CHF, AED, SAR, and CNY respectively.

Within the open market, PKR was traded at 201/202 per USD.

Meanwhile, the currency lost 78 paisa to the Pound Sterling as the day's closing quote stood at PKR 253.39 per GBP, while the previous session closed at PKR 252.61 per GBP.

Similarly, PKR's value weakened by 3 rupees against EUR which closed at PKR 216.09 at the interbank today.

On another note, within the money market, the overnight repo rate towards the close of the session was 13.60/13.80 percent, whereas the 1-week rate was 12.55/12.65 percent.

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