The Pakistani Rupee remains volatile as USD crosses 211

The Pakistani rupee remained unstable as it plunged to a record low rate of Rs211 against US dollar in the inter-bank market on Monday, June 20, 2022.

The US dollar was available at Rs211.21 at 11:03 am and had closed at Rs208.75 on Friday, according to the State Bank of Pakistan (SBP). The latest drop in the rupee’s value against USD comes after traders resorted to panic buying of USD. According to some reports some commercial banks had run out of the foreign currency last week.

Businessmen have urged the State Bank of Pakistan to play its top role in controlling the free-fall of the rupee in Pakistan. However, the central bank seemed helpless to control the situation as it cannot supply dollars in the market to support the rupee since its own stock of dollars also stands at a lower level.

Pakistan’s foreign exchange reserves (maintained with the State Bank of Pakistan) have depleted to a critical level and the country has less than six weeks of import cover remaining. The reserves are currently below $9 billion.

The country is fulfilling the prerequisite conditions to revive the IMF loan programme to avoid default on international payments. Pakistan’s Finance Minister Miftah Ismail also looking for help from the US to revive the IMF programme after the lending institution put harsh conditions for the programme’s revival.

Economy experts in Pakistan said the situation would get clear by end of June whether the IMF would resume its loan programme or not.

The rupee has devalued by a massive 34% (or Rs53.67) in the past year. It closed at Rs157.54 on June 30, 2021.

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