After three successive gains, the Pakistani rupee reverted to its losing ways against the US dollar, depreciating 0.45% on Wednesday.
The rupee fell by Rs1.25 in the inter-bank market to settle at 279 versus the dollar, according to the State Bank of Pakistan (SBP).
The loss comes after the currency settled at 277.87, an appreciation of 0.05% against the US dollar, on Tuesday.
Due to significant debt and currency devaluation, the country’s overall (domestic and external) debt stock increased to the Rs55-trillion threshold at the end of January.
The SBP reports that in the first seven months of the current fiscal year, the total debt stock of the central government increased by 15%. (FY23).
On Wednesday, the dollar reached multi-month highs against the majority of the world’s major currencies after Federal Reserve Chair Jerome Powell warned that US interest rates may need to increase even more quickly and significantly than anticipated in order to control persistent inflation.
The dollar benefits from higher rates as traders seek protection while global stock markets decline and because they increase the currency’s yield.
In Asian trading, the US dollar index increased 0.2% to a more than three-month high of 105.86. Sterling’s little decline to $1.1811 became the lowest price since late November.
The stock market crashed the previous day on fears that more rapid US interest rate hikes could harm demand, but oil prices, a major indicator of currency parity, stabilised on Wednesday as industry data revealed an unexpected drop in US crude oil stocks.
