Published: Thu, July 19, 2018
Business | By Tara Barton

Rupee weakens against dollar

Rupee weakens against dollar

Currency dealers in the open market have voluntarily halted transacting in dollars, awaiting clarity on rates and the extent to which the rupee would fall. Since December 2017, a total increase of Rs 22 has been seen in the value of the United States dollar.

The dollar gained by a further Rs6.75 against the rupee to touch its new high in the interbank market, a private news channel reported.

In the open market, the United States dollar rate has gone up to Rs129, the forex dealers said.

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Following a sudden rise of dollar value, an increase of Rs540 billion was seen in national debt and Rs1980 billion in foreign debt.

Pakistan's economic fundamentals have deteriorated ahead of the July 25 general election, with most financial analysts expecting the next government will need to seek a post-election bailout from the International Monetary Fund (IMF). Since December, the rupee has cumulatively shed over 21% of its value after the central bank reportedly abstained from intervening in response to the pressure due to a widening current account deficit.

To conclude, we can say that rupee depreciation would help freelancers, exporters and stock investors but in the long run, it is a serious threat to foreign exchange reserves and economy of Pakistan.

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