Pakistan rupee depreciated against the US dollar for the fifth straight week, down by 9 paisas (-0.05 percent) last week.
Though the rupee’s depreciation continues unabated on a weekly basis, it has slowed in terms of value for the fourth week in a low, as in the preceding three weeks, the rupee devalued by o.19 percent, 0.53 percent and 0.75 percent respectively.
According to the State Bank of Pakistan, the US dollar opened at Rs178.04 in the interbank market on Monday last and closed at Rs178.13 on Friday, the last working day of the week. Within the open market, the rupee was traded at Rs178.50-Rs179.20 per dollar during the week against Rs179-Rs181 in the preceding week.
During the last week, the rupee set two all-time new lows against the dollar against the preceding week when the number stood at three. The rupee held ground against the US dollar on Monday and remained unchanged at 178.04; however, it fell to new lows during the next two sessions. The rupee shed one paisa and fell to 178.05 against the US dollar on Tuesday. This was the then lowest ever rate of the local unit against the greenback. Again on Wednesday, the dollar jumped to Rs178.15, which is the fresh all-time low of the local currency against the greenback.
However, the last two sessions of the week remained calm for the rupee, as it recovered three paisas on Thursday and edged slightly lower on Friday by shedding only one paisa. Overall, the rupee shed by 9 paisas during the week.
However, on a month-on-month basis, the local unit has faced a depreciation of Rs2.41 against the US dollar during December. More importantly, the rupee has so far set 11 lowest ever levels against the US dollar during this month. The rupee has depreciated by Rs20.71 during the ongoing fiscal year 2021-22 and Rs17.98 in the current year 2021.
According to experts, the recent depreciation of the local unit is dictated by the International Monetary Fund (IMF) through prior actions and it has nothing to do with macroeconomic fundamentals. They say that there is a complete breakdown of economic policymaking as the country’s fiscal policy has become subservient to monetary and exchange rate policies.
On the other hand, the currency dealers say that the demand for the dollars for import and corporate payments remains usually high by the close of a calendar year. They say that foreign entities operating in Pakistan send their profits and dividends to their parent companies abroad by the end of the quarter.