Pakistani rupee nosedives to all-time low of 202.83 against US dollar

Islamabad [Pakistan], June 8 : The Pakistani rupee on Tuesday surpassed all prior records against the US dollar after shedding sheds Rs 2.77, or 1.37 per cent, against the US dollar in the interbank market.
It plummeted to an all-time low of 202.83 against the US dollar in the interbank market as demand increased due to oil-related payments and ambiguity regarding the revival of the multibillion, reported Geo News.
According to data released by the State Bank of Pakistan (SBP), the local currency surpassed its previous record low of Rs 202 recorded on May 26.
Moreover, for the first time in its history, the local currency made a historical drop of Rs 4.00 in a single day and surpassed Rs 204 threshold against the greenback in the interbank market during the intraday trade, reported Geo News.
Moreover, during the day the currency faced renewed pressure after foreign currency inflows from overseas Pakistanis through their Roshan Digital Account (RDA) dived to a 15-month low at USD 189 million in May 2022.
The market reversed the free fall and closed the day with a loss of nearly Rs 3. This was the third consecutive workday free-fall of the rupee.
In the open market, the rupee closed at a historic low of 204 against the greenback, according to the Forex Association of Pakistan.
Speaking to Geo News, Arif Habib Limited Head of Research Tahir Abbas said the currency is under pressure due to pending oil payments and rising oil prices in the international market.
"The plunge came on the back of a mammoth import bill and widened the current account deficit," the analyst said.
Abbas added that the market is keeping a close eye on the developments regarding the International Monetary Fund (IMF) programme, which is expected to be revived after the announcement of the budget as the government is taking all possible steps to meet the conditions laid forth by the Fund.
The recent bearish spell began after the government hiked the price of petroleum products by a major Rs 60 per litre as a result of removing subsidies -- one of the main demands of the money lender.
Traders believe caution can be expected this week ahead of the unveiling of the federal budget for the fiscal year 2022-23 scheduled to be announced on June 10 (Friday), with investors expecting IMF conditions of fiscal consolidation to dominate.
Renewed pressure on the rupee on an increase in fiscal-year-end dollar demand from importers and the corporate sector will keep the local currency under pressure.
Since the beginning of this fiscal year (July 1, 2021) to date, the rupee has collectively dropped by a massive 30.65 per cent (or Rs 48.29) compared to the previous fiscal year's close at Rs 157.54.
The rupee has maintained a downward trend for the last 13 months. It has lost 33.20 per cent (or Rs 50.56) to date, compared to the record high of Rs 152.27 recorded in May 2021, reported Geo News.