The Pakistani rupee fell more against the US dollar on Monday, falling 0.07% in the first hours of trading.
At 10:30 a.m., the rupee was trading at 287.02, down Re0.21 in the interbank market.
The rupee depreciated significantly in the previous week, falling 3.2% to close at 286.81 against the US dollar in the interbank market.
The drop on Friday marked the market’s sixth consecutive negative closing as optimism about the International Monetary Fund (IMF) agreement faded to make way for fundamentals. The depreciation in the interbank market also narrowed the gap with open market rates, which is one of the key indicators used to evaluate Pakistan’s Stand-By Arrangement with the IMF as the programme progresses.
Pakistan reported increased foreign exchange reserves in the previous week, but experts anticipate the currency will remain under pressure due to the removal of import restrictions and a backlog of inbound cargo.
In a significant development, the US stated that there is no quick solution to Pakistan’s economic challenges, but that the country should continue to work with the IMF to overcome its difficulties.
Globally, the US dollar had a strong start to a week of central bank meetings on Monday.
The US dollar index remained stable at 101.04.
Oil prices, a major measure of currency parity, fell on Monday as traders awaited additional rate hike signs from the US and European central banks, with tightening supply and prospects for Chinese stimulus supporting Brent around $80 per barrel.
