On Tuesday, the rupee dropped to a record low, losing 0.6% of its value against the US dollar in the interbank market. This happened because the restrictions on imports were eased, making the demand for the dollar go up.
The local currency went down by 1.87 against the dollar, and it was being traded at 299 during the day, according to the Exchange Companies Association of Pakistan (ECAP). Before this, the lowest it went was 298.93 on May 11.
On Monday, the rupee’s value was 297.13 against the dollar, compared to Friday when it was 295.78.
Tahir Abbas, the Head of Research at Arif Habib, said he thinks the rupee will be traded between 295 and 305 against the dollar for now.
The main reason for the rupee going down is because the import restrictions were eased, and companies could move their profits out of the country. This made the rupee leave the country too.
Adnan Agar, the Director at AA Commodities, said that the rupee going down is mostly because of political reasons. There’s uncertainty about the general elections and how they might get delayed. This could also delay the help the country was supposed to get from the International Monetary Fund (IMF) and other global lenders.
Agar added that the rupee will keep losing value until the political situation gets clearer.
