Pakistani rupee plunges to 239.65 after losing 0.74.
Rupee registers losses for 14th consecutive session.
Dollar was at an all-time high of 239.94 on July 28, 2022.
KARACHI: The Pakistani rupee continued to fall for the 14th consecutive session on Wednesday and hit a record historic low against the US dollar, with analysts expecting further depreciation of the local unit.
The rupee has been one of the worst performing currencies in the emerging markets and has fallen by nearly 9% so far this month owing to wide-ranging factors.
In the interbank market, the rupee plunged to 239.65 after losing 0.74, according to the data from the State Bank of Pakistan (SBP), down in value from the previous session’s close of 238.91.
The dollar now stands only Rs0.29 short of the all-time high level of Rs239.94 on July 28, 2022.
The heavy flooding and the lifting of a ban on imports have created pressure on the local unit, but the country is looking toward aid from friendly countries and multilateral and bilateral institutions to overcome the persisting economic crisis.
Floods have affected 33 million Pakistanis, inflicted billions of dollars in damage, and killed over 1,500 people — creating concern that Pakistan will not meet its debts.
Pakistan was able to resume the International Monetary Fund’s programme (IMF) and get a $3 billion rollover from Saudi Arabia, but the unprecedented floods have overshadowed everything else and led to a hit of at least $18 billion to the economy, which could go as high as $30 billion.
Samiullah Tariq, the head of research at Pak-Kuwait Investment Company, said: “[There’s] a greater demand than supply; floods have added to the import bill; aid hasn’t arrived in cash yet, but once it does, the liquidity position will ease.”
A weakening currency may worsen the price pressures after inflation surged to the highest in almost five decades. The nation is also grappling with the aftermath of a series of deadly floods and needs additional funds beyond the IMF’s $1.1 billion loan to avert a default.
The advent of floods and their negative effects on the country’s external account are to blame for the recent slide in the currency.
The loss of crops will now have to be made up for through imports and weak external flows, which have remained low since the signing of the IMF deal.
The $1.1 billion IMF loan tranche did help Pakistan improve sentiment, saving the country from default. However, additional inflows from the Middle East nations were anticipated to follow.
These inflows have not arrived yet, according to analysts.
In the past several months, investments and loans totalling $9 billion from Saudi Arabia, the United Arab Emirates, and Qatar have been promised to Pakistan.
While Saudi Arabia has already extended a $3 billion deposit that was due in December as part of that help for one year, the three countries have not yet distributed any new investments and have not provided a timeline for when they intend to do so.
The government is worried about a free fall of the rupee and is considering some steps to stabilise the foreign exchange market. Recently, the State Bank of Pakistan issued a show-cause notice to eight banks for selling dollars at prices higher than the current market rate, Finance Minister Miftah Ismail revealed over the weekend, to stop the rupee’s wild decline.
“The IMF loan was more to do with sentiment and was expected to be followed by inflows from other friendly countries,” said Sana Tawfik, economist at Arif Habib Ltd. in Karachi.
“These things were to materialize, but we don’t see any inflows yet.”
A 10-member Task Force has been formed by the government to digitize the Federal Board of Revenue (FBR) in partnership with the Special Investment Facilitation Council (SIFC).
Improving FBR’s systems and completely digitizing its operations are part of the Task Force’s mandate. Policy interventions, data automation, software installation, and collaboration with provincial revenue authorities are among the main goals.
Together with developing a track-and-trace system through integrated automation, the task force will also establish an Automated Supply Chain System for distributors and wholesalers.
Pakistan Revenue Automation Limited would become a stand-alone IT bureau for planning and data preparation.
In order to create a unified national tax strategy, the project seeks to maximize revenue collection, increase transparency, and simplify Pakistan’s tax system while encouraging cooperation between the federal and provincial tax authorities.
The benchmark 100 Index was up 777 points, finishing at 90,970 points, as the Pakistan Stock Exchange (PSX) maintained its striking upward trend for the sixth day in a row.
Strong market momentum and investor optimism were highlighted by the index’s 850-point spike earlier in the day, which briefly reached a record-breaking 91,050 points.
As trading activity hits previously unheard-of heights, the historic milestone represents increased investor optimism and represents a tremendous accomplishment for the PSX. Experts foresee continuous momentum if favorable conditions continue, attributing the ongoing advance to optimistic economic indicators and investor zeal.
The dates of the 2024 International Conference on Sustainable Agriculture are set for October 29 and 30 in Karachi.
Supported by the Green Pakistan Initiative, which has achieved great strides in the last year, the conference is organized by the Pakistan Media Development Foundation, Exhibitor TV, and Ripple Concept.
Focusing on enhancing agricultural productivity using contemporary technology, the conference supports the Special Investment Facilitation Council’s (SIFC) prioritizing of agriculture.
Experts will talk about sustainable techniques and organic farming, and there will be a plenary discussion on the Land Information and Management System.
In order to facilitate connections between professionals and stakeholders, the event will also feature exhibitions that promote contemporary methods and technologies.
Sindh and Balochistan’s agriculture departments will display their accomplishments in provincial pavilions. Participants will also include sponsors Saudi-Pak Investment Company, National Bank of Pakistan, and Bank of Punjab.