Pakistani Rupee Falls to Record Low Against US Dollar
The value of the Pakistani rupee has hit an all-time low, according to recent reports. Of 206.25 against the US dollar on Thursday, investors continued to sell the currency amid concerns over the country’s economic outlook.
The rupee has been under pressure recently as the country’s foreign exchange reserves have fallen to a critical level.
The central bank has been intervening in the market to prop up the rupee, but its efforts have been unsuccessful.
The fall in the rupee is likely to add to the inflationary pressures in Pakistan. The country’s inflation rate is already around 13%, and the fall in the rupee is likely to push it even higher.
The fall in the rupee is also likely to make imports more expensive, which could further hurt economic growth.
The government has been trying to secure a The country received a bailout from the International Monetary Fund (IMF), but… the IMF has so far been reluctant to provide a bailout without significant economic reforms.
The fall in the rupee is a sign that the economic situation in Pakistan is deteriorating. The government needs urgent action to stabilize the economy and avoid financial crises.
Here are some of the factors that are contributing to the decline of the Pakistani rupee:
- Falling foreign exchange reserves: Pakistan’s foreign exchange reserves have fallen to a critical level. As of June 16, 2023, the country’s foreign exchange reserves stood at $10.3 billion, only enough to cover about two months of imports.
- High inflation: Pakistan’s inflation rate is already around 13%, expected to rise further in the coming months. This puts pressure on the rupee as investors demand higher interest rates to protect their investments from inflation.
- Political instability: Pakistan is also facing political instability. The government is facing a no-confidence motion, and there is uncertainty about the country’s future. This also puts pressure on the rupee, as investors worry about the country’s economic future.
The fall in the rupee is a serious problem for Pakistan. It is making imports more expensive, which is hurting economic growth. It is also putting pressure on the government’s finances, as it has to spend more money importing essential goods.
The government needs to take urgent action to stabilize the rupee. It needs to secure a bailout from the IMF and implement economic reforms to address the underlying problems in the economy.