The downtrend in rupee’s value persisted on Wednesday as the currency slipped by Rs0.09 against the US dollar and closed at an all-time low of Rs171.13 in the inter-bank market due to speculation about negotiations with the International Monetary Fund (IMF) for the resumption of $6 billion loan programme.

In addition, a soaring trade deficit coupled with the worsening current account situation mounted pressure on the rupee.

According to the State Bank of Pakistan (SBP), the rupee had closed at Rs171.04 against the greenback on Tuesday.

Speaking to The Express Tribune, Arif Habib Commodities Managing Director and CEO Ahsan Mehanti said that the ongoing wave of rupee depreciation was being witnessed due to uncertainty about negotiations with the IMF.

Read Rupee crosses 171 against dollar

“There is a mix of positive and negative speculation and it is impacting capital markets of Pakistan including the foreign exchange market,” he said. “However, a majority of the public expects the imposition of stringent tax measures, hence, the overall sentiment has weakened.”

The uptrend in prices of commodities in the international market was also exerting pressure on the rupee, he pointed out.

Published in The Express Tribune, October 14th, 2021.

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