May 16, 2022 (MLN): The downhill of the Pakistani rupee (PKR) took it to the historic low at 194 against the US dollar in the interbank market, shedding 1.57 rupees in an intraday trade on Monday.
The dollar was quoted at 194.08/ 194.58 [11:40 PST] when compared to the previous day’s close of 192.53.
Amid rising political heat, uncertain economic conditions, weak macros, delay in IMF tranche, and the government’s hesitation in taking tough decisions, the local unit continued taking a major hit in the interbank market against the greenback.
As per the experts, the major reason behind this freefall is the delay in the revival of the IMF program along with the absence of funding from friendly countries.
According to Malik Bostan, President of Forex Association of Pakistan, the government has to roll back subsidies in order to receive a tranche from IMF.
Though the end of subsidies will increase inflationary pressure on the end consumers but inflation is a global phenomenon, he added.
To counter this crisis-like situation, the government should ban the import of vehicles for five years along with all non-essential items, he recommended.
This way, the government could save up to $18 billion after curbing nonessential goods imports.
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