The Pakistani rupee continued its downward spiral on Tuesday, falling to a new low of 221 against US dollar in the open marker as it lost Rs6 by midday.
However, during interbank trade in the morning, dollar was equal to 218 Pakistani rupees – a fall of Rs2.80 after yesterday’s close of Rs215.20.
Data released by State Bank of Pakistan yesterday showed that the rupee lost Rs4.25, or 1.97%, against the US dollar.
It was the highest day-on-day depreciation after March 26, 2020.
On June 22, the rupee had closed at a record low of 211.93 against the greenback and since then the currency has remained volatile.
The Punjab by-elections has triggered political uncertainty along with import pressure took the Pakistani rupee to new lows.
Analysts believe, however, that the domestic political and economic situation are not the only factors at play.
“The dollar is getting stronger in the global market against many currencies and the Pakistani rupee is not exception, said Alpha Beta Core CEO Khurram Schezad.
Speaking of Pakistan’s financial situation, Schezad said that the country’s external account issues “are not settled as yet, the IMF (International Monetary Fund) is yet to be on board, and the flows are yet to materialise”.
“Global rating agencies have put a negative outlook on the economy, so that is an additional burden that is weighing on the financial markets in general and foreign exchange market in particular,” he added.