Pakistani Rupee Extends Losses Against US Dollar
(CTN News) – For the third session in a row, the Pakistani rupee declined against the dollar on Friday, shedding 97 paise in the interbank market.
According to the State Bank of Pakistan, the local currency depreciated by 0.44 percent from yesterday’s finish of Rs221.5 to settle at Rs222.47 per US dollar.
According to information gathered by Mettis Global, the value of the rupee has decreased by Rs16.64 or 7.52 percent since the start of the current fiscal year.
The PTI’s lengthy march, scheduled to start today, has “dampened emotions once again,” according to Tresmark’s Head of Research Komal Mansoor, and as a result, the value of the rupee is declining.
In addition, she said that investors prefer to maintain their dollar investments due to the increased risk profile.
Early this week, the probability of a sovereign default grew to its highest level since November 2009. On October 25, the country’s five-year credit default swap (CDS), a kind of protection against the possibility of a sovereign failure, climbed by more than three percentage points to reach 52.8pc, a 13-year high.
Investors’ decreasing confidence in Pakistan’s capacity to repay its foreign debts is reflected in the growing CDS level.
According to FAP Chairman Malik Bostan, the protracted march and political unrest were further factors in the rupee’s decline. He said that although banks were also buying the dollar at greater rates, which was driving up costs, importers were buying the US dollar out of worry that the rate would rise.
According to Bostan, exporters kept their gains overseas, hoping the dollar’s value would increase, leading to bigger profits.
The FAP chairman encouraged the government and opposition parties to resolve differences via dialogue and warned that the rupee would hit a new low if political uncertainty persisted.
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