A day after 100-day festivity dollar hits Rs144
Negotiations with the IMF ended without a much-needed bailout agreement.
Sudden devaluation of local currency against the US dollar was witnessed in interbank trading on Friday morning as the greenback hit an all-time high of Rs144.
Reports said that that the sudden rise of Rs10 in the value of the dollar is based on the government’s commitments to the International Monitory Fund (IMF).
The State Bank of Pakistan has indirectly devalued the state-managed unit several times already as it tries to narrow a huge balance of payments deficit.
But traders are growing concerned that neither PM nor his Finance Minister Asad Umar laid out a comprehensive plan to address the country’s economic woes more than a week after negotiations with the International Monetary Fund ended without a much-needed bailout agreement.
“The market was disappointed to see that there was no clear cut direction of the government regarding raising loans from IMF or taxation policies for the rest of its term,” said HamadIqbal, director of research at Elixir Securities.
The rupee has lost about a third of its value since the start of the year as Pakistan struggles with chronic inflation as it burns through its dwindling foreign currency reserves, which are down around 40 per cent this year.