KARACHI: The dollar continued its upward trend in the interbank market on Tuesday closing at Rs121.50 against a dollar.
“The dollar touched Rs122 in the interbank today against its official close of Rs121.50,” a market source said. Since December, the rupee went down by 14 per cent against a dollar. “The dollar had increased by over Rs15 in the past six months,” a brokerage house analyst said. The most recent 60-paisa hike in the inter-bank market has taken the price of the US dollar to Rs122 today, the analyst added.
An increase of Rs5.65 in dollar value has been seen within previous two days due to which, the national debt has reached Rs500 billion, the sources claimed.
The greenback had reached a record-high of Rs121.50 on June 11 — the State Bank of Pakistan (SBP) had attributed the movement to a gap between foreign exchange demand and supply in the interbank market.
SBP in its statement has claimed that this movement is based on the foreign exchange demand-supply gap in the interbank market. The market-based adjustment is reflective of the country’s external balance of payments position which is under pressure due to a large trade deficit.
Despite the continued growth in exports (13.3 per cent in Jul-Apr FY18) and some uptick in remittances, growing imports have pushed the current account deficit to $14.0 billion during the first ten months of FY18, which is 1.5 times the level of deficit realised during the same period last year.
SBP is of the view that this market-driven adjustment in the exchange rate along with other recent policy measures is expected to contain the imbalances in the external account thereby containing aggregate demand and also facilitate the prospects for generating non-debt creating inflows.