Rupee plunges 186 against US dollar today, weakest level in history

The Pakistani Rupee (PKR) continued its bleak descent against the US Dollar (USD) today and reported losses in the interbank market. Today’s session ended with the local currency losing 89 percent against the greenback.

As per the State Bank of Pakistan (SBP), the rupee closed at 186.13, its weakest level in history, after a day-on-day depreciation of 90 paisas.

Interbank closing #ExchangeRate for todayhttps://t.co/yAjMEbPycV pic.twitter.com/050b3qtjWk

— SBP (@StateBank_Pak) April 6, 2022

The rupee has now lost over 18% since its most-recent high in May last year, while on a fiscal year to date (FYTD) basis, the local currency has depreciated by over 15%. Since March 2022 alone, the rupee has nearly 5% against the dollar.

As the rupee plunged to yet another all-time low against the dollar, futures had risen Wednesday, reversing earlier losses, as the possibility of fresh sanctions against Russia sharply raised supply concerns, counteracting worries about a fall in demand caused by higher US oil stocks and the lockdown in Shanghai due to COVID.

The market expert added that clarity on the political end would revamp the rupee back to its ‘pre crisis’ level of 180.

Meanwhile, the local business community has also expressed concern over the devaluation of the local currency. Karachi Chamber of Commerce & Industry (KCCI) president Muhammad Idrees urged the central bank to play its role and devise an effective strategy to stop further devaluation.

The Pakistan Business Council (PBC) also expressed concern over the rate of depletion of foreign exchange reserves and called for urgent attention.

“Correct the price of fuel, impose rationing,” said the PBC, adding that the said decisions might be unpopular and difficult, but can be taken by the caretaker setup. “Then address more fundamental reforms which call for consensus,” it added.

The rate of depletion of FX reserves calls for urgent and courageous attention. Correct the price of fuel, impose rationing NOW!Unpopular & difficult. Let caretakers do it. Then address more fundamental reforms which call for consensus. Both are existential in severity.

— The Pakistan Business Council (@ThePBC_Official) April 6, 2022