No respite: Rupee continues to weaken against dollar, closes at 236.84

• Rupee has been under renewed pressure against US dollar this month.
• It has lost 8.66 against the greenback during the week.
• Market experts believe this is primarily due to strengthening US dollar index.

KARACHI: The Pakistani rupee continued to weaken against the US dollar on Friday as high demand for the greenback kept the local unit under pressure.

The local currency registered a decline for the 11th consecutive session, closing the week at 236.84 against the greenback after losing nearly Re1 or 0.41%. The dollar now stands only Rs3.1 short of the all-time high level of Rs239.94 on July 28, 2022.

The rupee has been under renewed pressure against the US dollar this month. Market experts believe this is primarily due to the strengthening US dollar index, alongside a rise in the import of food-related items.

The rupee — which has been continuously losing its value despite the revival of the International Monetary Fund (IMF) programme — weakening streak can be attributed to a host of reasons including low dollar inflows amid pressure for import and debt servicing.

Moreover, political uncertainty is also impacting the rupee value. Pakistan has not been able to receive financing from multilateral financial institutions, despite securing the funding from IMF last month, which has been putting pressure on the country’s forex reserves — which dipped $176 million, clocking in at $8.62 billion as of September 9, 2022.

However, it is not just the rupee, leading currencies of the world have also lost value against the US dollar in recent times, which was also affecting the Pakistani currency.

Foreign exchange reserves held by the State Bank of Pakistan (SBP) dipped by $176 million.