Muscat/Karachi: The exchange rate of Pakistani rupee against Omani Rial climbed to a new high on Wednesday with one Omani Rial fetching almost PKR605, according to the currency converter XE. Pakistani expatriates were seen making a beeline to exchange houses in Oman owing to the rise in exchange rate.
Abdul Ghaffar, a long time Pakistani expat, said he was waiting for this moment due to the volatility in the market and expected fears of further depreciation in PKR. He had not sent money back home for months and was waiting for this moment so that he could get good returns on his savings.
Another expat Mohammed Mohsin was also upbeat while leaving the exchange house after sending money to Pakistan as it was a ‘bonus’ for him for the same amount of money he used to send in the past. Pakistani rupee (PKR) reached a new low against the US dollar on Tuesday, closing at Rs 232.93 in the interbank market.
The local unit closed at Rs 232.93 in the interbank market, up from Rs 229.88 a day earlier, as it shed Rs3.05 or 1.31 per cent against the dollar, data from the State Bank of Pakistan (SBP) showed. As per analysts, the persistent political crisis is to be blamed for the Pakistani rupee’s continued losing ground against the US dollar, reported Geo News.
The financial markets remained jittery amid an ongoing political crisis.
The rupee has been one of the world’s worst-performing currencies, slumping more than 30 per cent since the start of the year (2022), The News reported.
Tahir Abbas, the head of research at Arif Habib Limited, said, “Shortage of dollars, political and economic uncertainty tagged with ambiguity regarding commitment from friendly countries, which is needed for disbursement of IMF tranche were the reasons behind rupee’s persistent slide.”
Fears have risen about Pakistan’s stuttering economy as its currency fell nearly 8 per cent against the US dollar in the last trading week, while the country’s forex reserves stand below USD 10 billion with inflation at the highest in more than a decade, reported Geo News.
Alpha Beta Core CEO Khurram Schezad told Geo.tv that the dollar is getting stronger in the global market almost against all the world currencies — and the rupee is not an exception.
In addition, he said, Pakistan’s external account issues are not settled as yet though imports are slowing.
He noted that although the International Monetary Fund is on board for disbursement, the flows are yet to materialise as the Executive Board’s final approval is awaited, reported Geo News.
“Global rating agencies have put a negative outlook on the economy, so that is an additional burden that is weighing in on the financial markets in general and forex market in particular,” he added.
Muhammad Saad Ali, a capital market expert, told Geo.tv that the rise in political uncertainty — of whether the present government will remain in office long enough to stabilise the economy and the continued confusion around who governs the Punjab province — is causing the rupee to slip.
“Note that balance of payments pressure on the currency has eased, as per the central bank, which asserts that Pakistan has enough capital commitments for the next 12 months to take care of its dollar outflows,” he said.
“I reiterate political uncertainty is weakening market sentiment and leading to more rupee depreciation,” Ali added.
With ANI inputs
