In the interbank market on Tuesday, the Pakistani rupee fell by Rs 0.60 to an all-time low of Rs 188.66 against the US dollar, as looming uncertainty over the resumption of the International Monetary Fund (IMF) loan programme weighed on the local unit, according to Geo News.
The rupee surpassed its record low of Rs 188.18 set on April 7.
Currency dealers believe that a delay in the IMF program, a lack of immediate financial support from friendly countries, depleting foreign exchange reserves, and a soaring trade deficit kept the domestic currency under pressure.
The new government’s reluctance to eliminate fuel and electricity subsidies, which are required for the IMF program to be revived, dampened investor confidence.
Furthermore, investors are concerned about falling foreign currency reserves (because remittances and export proceeds are insufficient to meet market demand), rising external debt payments, and soaring imports. According to Geo News, this is putting pressure on the rupee.
There is also uncertainty about financial support from Saudi Arabia, the United Arab Emirates, and China. The political temperature was also rising after former Prime Minister Imran Khan announced that he would march to Islamabad with his supporters after May 20 to demand new elections.
