Rupee closes near record low at 239.65 against dollar

KARACHI: The Pakistani rupee continued to fall for the 14th consecutive session on Wednesday and hit a near record low of 239.65 against the US dollar, with analysts expecting further depreciation of the local unit.

The rupee has been one of the worst performing currencies in the emerging markets and has fallen by nearly 9 per cent so far this month owing to wide-ranging factors.

In the interbank market, the rupee plunged to 239.65 after losing 0.74, according to the data from the State Bank of Pakistan, down in value from the previous session’s close of 238.91, Geo News reported. The dollar now stands only Rs0.29 short of the all-time high level of Rs239.94 on July 28, 2022.

Samiullah Tariq, the head of research at Pak-Kuwait Investment Company, said: “[There’s] a greater demand than supply; floods have added to the import bill; aid hasn’t arrived in cash yet, but once it does, the liquidity position will ease.”

The $1.1 billion IMF loan tranche did help Pakistan improve sentiment, saving the country from default. However, additional inflows from the Middle East nations were anticipated to follow. These inflows have not arrived yet, according to analysts.

In the past several months, investments and loans totalling $9 billion from Saudi Arabia, the United Arab Emirates, and Qatar have been promised to Pakistan.

While Saudi Arabia has already extended a $3 billion deposit that was due in December as part of that help for one year, the three countries have not yet distributed any new investments and have not provided a timeline for when they intend to do so. “The IMF loan was more to do with sentiment and was expected to be followed by inflows from other friendly countries,” said Sana Tawfik, economist at Arif Habib Ltd. in Karachi. “These things were to materialise, but we don’t see any inflows yet.”