Rupee Crashes Against US Dollar as Forex Reserves Reach Dangerous Levels

Rupee Crashes Against US Dollar as Forex Reserves Reach Dangerous Levels in 2022

Today, the Pakistani Rupee (PKR) fell further against the US Dollar (USD) and reported losses in the interbank market. At the end of today’s session, the rupee fell by Rs. 1.04 against the US dollar.

It fell 0.56 percent against the US dollar today, closing at Rs. 186.97, after losing Rs. 1.48 and closing at Rs. 185.92 in the interbank market on Wednesday, April 20. During today’s open market session, the rupee hit an intraday low of Rs. 186.75 against the US dollar.

The local currency has lost 2.93 percent of its value against the US dollar in the last four trading sessions.

The rupee fell further against the dollar today, after oil prices soared on Thursday due to supply chain concerns as the European Union considers a potential ban on Russian oil imports, just days after Libya’s scarcity rattled the market. At the time of writing, Brent crude futures were up $1.53, or 1.43 percent, to $108.3 per barrel, while US West Texas Intermediate (WTI) crude futures were up $1.07, or 1.05 percent, to 103.3 per barrel.

At home, the central bank’s weekly report released on Thursday revealed that the country’s total liquid foreign exchange reserves increased by $16.9 million (+0.1 percent) to $17.045 billion on April 16, 2022, up from $17.028 billion the previous week. The SBP reserves increased by $36.1 million to $10.88 billion (+0.3 percent) from $10.85 billion the last week.

Asad Rizvi, former Treasury Head of Chase Manhattan Bank, stated earlier in the day that the PKR is under severe pressure as forex reserves have dipped to a dangerous level. Payments in the fourth quarter of FY22 are substantial, necessitating additional funding and quick arrangements, as exports and remittances may not be sufficient.

The PKR fell further against the other major currencies today, with losses reported in the interbank currency market. It lost 27 paisas when compared to the Saudi Riyal (SAR) and 28 paisas when compared to the UAE Dirham (AED).

In today’s interbank currency market, it lost Rs. 1.15 against the Australian Dollar (AUD), Rs. 2.04 against the Canadian Dollar (CAD), Rs. 2.42 against the Pound Sterling (GBP), and Rs. 2.96 against the Euro (EUR).

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