Aamir Qureshi—AFP
The Pakistani rupee on Tuesday declined to a historic low of 299.01 against the U.S. dollar after depreciating by 0.63% in the interbank market, with analysts attributing it to ongoing economic uncertainty and the withdrawal of import restrictions that had increased the demand for the dollar.
In a statement, the State Bank of Pakistan (SBP) said the rupee had dropped by 1.88 at the close of day on Tuesday, after being recorded at 297.13 a day earlier. This is the lowest value ever recorded of the rupee, with its previous low hitting 298.93 on May 11.
The rupee has been on a persistent decline in the interbank market over the past two weeks, with it closing at Rs. 295.78 against the U.S. dollar on Friday. According to analysts, it is likely that the rupee would continue to slide in the coming days, with it expected to stabilize—for a short time—around 305 against the dollar. They have attributed this slide to ongoing uncertainty triggered by a lack of clarity on the timing of general elections, as well as the previous government’s easing of import restrictions in line with an agreement with the International Monetary Fund (IMF). This lifting of restrictions, they say, has increased dollar demand.
There has, as yet, been no indication from the interim government currently in power on how it aims to tackle the ongoing devaluation of the rupee.