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PKR plunges by over four rupees against USD

Repatriation of profit surges to $759.2m in 8MFY24
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January 26, 2023 (MLN): Amidst the removal of the dollar cap in the open market, the Pakistani rupee (PKR) took a nosedive against the mighty US dollar as the currency plunged by over four rupees in early trade in the interbank market session compared to the previous close of PKR 230.89 per USD.

The dollar was being quoted at 234.97/244.97 (10:37 PST) with the trades being reported at 235 while in the open market, the dollar is being traded at 247.50/250 per USD.

It is pertinent to mention that following Tuesday’s announcement by the Exchange Companies (ECs) regarding the removal of the dollar cap in the open market, the dollar in yesterday’s open market was reportedly traded at PKR 252.50 [10:00 am] per USD during the initial trading hours, however, within an hour, the greenback depreciated to PKR 243 per USD down by 4% [11:00 am] in the open market, raising suspicions of undue intervention from authorities.

However, speaking to Mettis Global, Malik Bostan President of the Forex Association of Pakistan said, “The drastic appreciation and depreciation within an hour was only due to speculative elements as we have only removed the cap from dollar rates.”

The rates will be purely determined by the demand and supply available in the market, he added.

Experts are of the view that the decision to cap the dollar rate at the open market in Pakistan has had unforeseen consequences. The cap has created a black or gray market for dollars, as individuals and businesses look for ways to access the currency at a more favorable rate.

The capping of the dollar is seen as a hint of a weakening economy and an increased risk of default.

As the rupee continues to slide down the slippery slope, many are left wondering if there’s a light at the end of the tunnel.

The falling rupee has further caused widespread concern among businesses and individuals who rely on imports.

The situation has left many feeling like they’re between a rock and a hard place, as they struggle to make ends meet in the face of rising prices.

Copyright Mettis Link News

Posted on: 2023-01-26T10:39:34+05:00