Pakistan rupee continued its losing streak against the US dollar during the last week in the interbank market and shed Rs0.65 (-0.38 percent).
According to the State Bank of Pakistan, the US dollar opened at Rs170.53 and closed at Rs171.18 on Friday, the last working day of the week. Within the open market, the rupee was traded at Rs171/172.20 per dollar during the week.
During the last week, the rupee struggled during the first four days of the week and weakened by 21 paisas (-0.12 percent) on Monday, 30 paisas (-0.18 percent) on Tuesday, 9 paisas (-0.05 percent) on Wednesday and 7 paisas (-0.04 percent) on Thursday; however, last day remained positive for the local unit and it recovered 2 paisas (+0.01 percent) on Friday.
The Pakistani rupee shed Rs0.65 during the last week against the US dollar, while depreciation during the fiscal year 2021-22 has been Rs13.76. The local unit has shed Rs10.91 against the US dollar in the current year 2021. The local currency has maintained a downtrend after it touched 22-month high of Rs152.48 in May 2021, losing a cumulative Rs18.87 in the past five months to date.
The currency experts said that high international commodity prices and rising domestic demand after ease in coronavirus cases escalated the demand for imported goods. On the other hand, the Afghan situation has also been impacting the rupee-dollar parity since August 15 last.
They said the local currency is likely to stay under pressure this week due to large external payments. The oil import bill is the major reason for the massive depreciation in the local currency. The oil import bill registered a phenomenal growth of 97 percent to $4.59 billion during the first quarter of the current fiscal year, compared with $2.33 billion in the corresponding quarter of the last fiscal year.
Similarly, the import of completely built unit (CBU) cars registered 144 percent growth to $95.52 million during July–September 2021, compared with $39.15 million in the same period of the last year. Likewise, the import of completely knocked down (CKD) cars registered 226 percent growth to $407.48 million during the quarter under review, compared with $124.78 million in the same quarter of the last year.
According to experts, the government needs to check the imports of non-essential and luxury finished products to save foreign exchange and support the local currency from further depreciation.
The writer heads a leading news wire service ‘The Law Today Pakistan’ commonly known as TLTP. He has a special focus on news relating to superior courts adjudication, access to right of information, civil, political, social and economic rights under the approach that existing cyber regime realization ensures procedural fairness in administrative law. He can be reached at email@example.com