In the interbank market, the Pakistani rupee resumed its downward trend versus the US dollar as continuous political unrest dampened investor confidence.
Players were unimpressed by the announcement of anticipated inflows from China and the International Monetary Fund (IMF) following the ninth review due for this month.
The rupee dropped in value from yesterday’s close of 220.65, according to the State Bank of Pakistan (SBP), and closed the day at 221.43 after losing Re0.78, or 0.35%, in the interbank market.
In a note, Arif Habib Limited stated that recent exchange rate volatility was the norm due to debt obligations over the next 12 months and the still challenging global economic environment.
Effective negotiation with bilateral and multilateral partners, especially following the floods, will particularly benefit in stabilising the parity, according to the brokerage.
Additionally, as investors wait for the US Federal Reserve’s policy announcement amid expectations that it will signal a delay in future rate hikes, the US dollar fell on the global market.
According to the Pakistan Bureau of Statistics, the inflation rate based on the Consumer Price Index (CPI) rose to 26.6% year-on-year in October 2022 from 23.2% in September and 9.2% in October 2021, which could lead to further depreciation of the currency.
