KARACHI: The US dollar surged to its all-time high of Rs.125 in the open market on Wednesday after gaining by a further Rs. 0.5 from yesterday, as the Pakistani rupee continued its slide in an apparent sign of vulnerability in the country’s economy.
In the inter-bank market, however, the dollar has weakened by Rs. 0.33 and was being traded at Rs.121.40, after climbing to Rs.121.73 earlier, forex dealers said.
The rupee drop threatens to squeeze consumers ahead of the general election set for July 25. The dwindling foreign reserves and a widening current account deficit have triggered speculation about going back to the International Monetary Fund for loans for the second time since 2013 – a possibility that was vehemently rejected by interim finance minister Dr. Shamshad Akhtar earlier this month.
In December and in March, the rupee was devalued, each time by about 5 percent, by the State Bank of Pakistan. Since December, the rupee has depreciated by about 14 percent.
Originally published here.