A currency trader counts Pakistani rupee banknotes while preparing to exchange US dollars in Islamabad, Pakistan, December 11, 2017.Reuters/Caren Firouz/File Photo Acquisition of license rights
KARACHI, Pakistan (Reuters) – The Pakistani rupee closed at a record low of 299 rupees against the dollar in the interbank market on Tuesday after easing import restrictions boosted demand for the dollar. central bank data showed.
Pakistan has imposed import restrictions from 2022 to stem the outflow from its dwindling foreign exchange reserves. The lifting of those restrictions from June was a condition of a $3 billion International Monetary Fund loan program to help the economy in crisis.
Traders said the rupee fell 0.6 percent to an intraday low of 299 rupees against the dollar. It hit a closing low of 298.93 on May 11. It came two days after the arrest of former Prime Minister Imran Khan on corruption charges plunged the country into further political turmoil.
Pakistan is currently ruled by a caretaker government, tasked with steering the country theoretically through national elections due by November, but at the same time facing severe political tensions and historically high inflation. And facing interest rates.
Tahir Abbas, head of research at Karachi-based brokerage Arif Habib, said he expects the rupee to trade between 295 and 305 rupees to the dollar for the foreseeable future.
“This downward trend is largely due to the reduction of backlogs of goods and services, as well as the easing of import restrictions,” he said.
He added that multinationals were able to repatriate some of their profits, prompting the outflow of rupees.
Reported by Aliba Shahid of Karachi.Editing: Edwina Gibbs and Conor Humphries
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