Pak rupee has hit record low and reached Rs140.24 against the US dollar in the inter-bank market. It is being reported that Pakistan has had an agreement with International Monetary Fund (IMF) and it has been decided to depreciate the currency before obtaining the bailout.
According to the State Bank of Pakistan rupee has dropped further by Rs0.75, thus it has depreciated by Rs1.70 in the last two week.
Despite the announcement by Ministry of Finance that China will given $2.1 billion to Pakistan, the rupee has lost value. Also Malaysia signed 5 big projects MoU worth $800 million investment in Pakistan.
The spokesman of Finance Ministry Khaqan Hassan Najeeb tweeted, “Clearly, no target rupee/dollar exchange rate is envisaged. The speculation is baseless and unfounded.”
Furthermore the spokesman cleared, “Discussions with international partners do not entail any target level of the exchange rate. Focus is on further strengthening the exchange rate regime, aligning it and keeping it consistent with evolving macroeconomic fundamentals of the economy.”
According to experts the rupee devaluation is not surprising, it was something expected.
A leading banker said, “We have anticipated the rupee will drop to 142 by the end of this month. Today’s drop is close to the expected rupee-dollar parity.”
He said that the government is gradually making adjustments regarding rupee value. Adding, “The gradual adjustment is good rather than the local currency shedding value by a notable Rs5-10 as a sudden big drop causes losses to businesses. Oil prices have started moving up…that is the main source of pressure, which is coming on our currency.”