KARACHI
Removing the cap on the interbank rates, the State Bank of Pakistan (SBP) on Wednesday devalued Pak rupee by Rs 3.43 against US dollar as the local banks sold the dollar at Rs 108.30 since morning.
The analysts had already been forecasting the devaluation of the Pak-rupee for last two months, because of a rising trade deficit and current account deficit. The trade deficit of the country enhanced to $ 29.998 billion or 42.12 per cent while the country’s current A/C deficit widened to $ 8.929 billion during the last eleven months.
The sources from the banks on Wednesday said that the dollar is being traded above Rs 108.30 for buying and Rs 108.35 for selling since the morning as the central bank has removed the cap on interbank rates which were at Rs 104.87-104.90 last night.
A banker said, “There was no intervention of the central bank today to control the greenback as SBP often did in the past which resulted in the increase of exchange rates of Pak Rupee vs dollar by Rs 3.43 till 3 pm today.”
The central bank had already lost billions of dollars from its reserves to overcome the value of rupee in interbank market since the last six months, the analyst said.
“Political uncertainty in Pakistan could be another reason for the rise of exchange rates,” he added.
The experts said if the dollar moves up then the Pakistan economy, which had been stable in the international market, will collapse, and prices of all commodities would automatically increase in local markets.
Pakistan had already accumulated above $ 65 billion debt and its return cost would also increase with the surge of ‘Rupee to Dollar parity.’
This surge would be counted as the second big increase in the interbank rates in last four years of the government of Nawaz Sharif. Earlier in 2014, the government depreciated Pakistani currency by Rs 2.
