KARACHI: As the nation struggles with a money shortage, the Pakistani rupee lost more ground against the US dollar during Tuesday’s intraday activity on the interbank market.The local currency was trading at 217.70 after losing 1.05 versus the US dollar due to a currency crisis that analysts attribute to the United Arab Emirates’ new regulations, smuggling, and the relaxation of the import ban.
There has been a spike in the open market price of the US dollar as a result of the UAE’s requirement that Pakistani travellers report 5,000 dirhams at the airport upon arrival.Dr. Khaqan Hassan Najeeb, an economist and former consultant to the federal ministry of finance, claimed that recent political developments are partly to blame for the rupee’s decline, which is producing market anxiety in addition to the dollar’s global strengthening.
He added that the State Bank of Pakistan’s (SBP) declining foreign reserve holdings were another factor in the decline. With only $7.8 billion in reserves, there is barely enough money to cover a month’s worth of imports.In addition, the government’s move to lift the prohibition on the import of luxury and non-essential commodities in order to satisfy an IMF requirement is also gradually weakening the rupee.
