SBP Couldn’t Contain Rupee Fall Against US Dollar
The local currency hit an all-time low against the US dollar and closed at 169.97 in the interbank on Tuesday
Pakistani rupee continues to fall against the US dollar despite two measures taken by the State Bank of Pakistan (SBP).
The local currency hit an all-time low against the US dollar and closed at 169.97 in the interbank on Tuesday.
It has peaked at the level of Rs 172 in the inter-bank on Wednesday.
Some experts say that the main reason behind the depreciation of the rupee is the widening gap in the current account deficit.
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They also warned that the current situation can bring new wave inflation in Pakistan as speculations are running rife that the dollar might hit Rs 190 against the rupee in October.
SBP had taken measures to control import and demand growth in consumer financing.
According to regulations, the maximum tenure of the auto finance facility has been reduced from 7 years to 5 years.
In the latest development, new as well as used imported vehicles will not be eligible for auto financing from banks.
Besides this, the central bank has pumped $1.2 billion into the inter-bank market in the past three months.
However, this could not stop the weakening of the rupee and it further deteriorated.
Pakistan Stock Exchange (PSX) has sharply declined by 1,098 points until Wednesday afternoon.
The decline in the index is due to the fall of the rupee against the dollar and US senators moving a bill to probe into Pakistan’s role in Afghanistan pre and post Taliban.
