KARACHI: The Pakistani currency maintained its downturn for a seventh straight session, hitting a low of over Rs157 against the US dollar in the interbank market on Monday.
Since the morning, it moved both ways within a range of Rs156.50 to Rs 157.07. Latest updates showed the rupee stood at Rs156.96, up by Rs1.12 from Friday’s closing rate of Rs155.84.
“Our mounting international payments have increased pressure on the rupee against the dollar,” a banker told media.
The banker, who requested anonymity, said the backlog of import payments accumulated over the Eidul Fitr holidays and the forthcoming debt repayments have kept the rupee under immense pressure.
“Pakistan continues to accumulate more debt to pay off its existing debt. This is not a sustainable solution. We have to increase our foreign income and the only permanent solution to that is increasing exports,” he said.
Secondly, he added, the government has now allowed market forces to decide the rupee-dollar exchange rate and the central bank was not intervening in the inter-bank market.
“This new mechanism means the volatility being witnessed in the rupee-dollar exchange will continue,” he said.
A currency dealer said speculation within the market suggested the rupee was heading towards the International Monetary Fund’s (IMF) dictated level of Rs160-165.
The government, however, has time and again denied that any such agreement was part of the deal reached with the IMF for a $6 billion package.