The Pak Rupee has dropped to Rs 125 against the dollar in the kerb market. It has depreciated lowest since last seven weeks.
The rupee has fallen against the dollar following a meeting held between Asad Umar the Finance Minister and the dealers at the currency exchange. Though the dealers part of the meeting have clearly denied any relation between the two events, there do seem to be a connection.
As Pakistan’s economy is suffering, the new government of Pakistan Tehreek-e-Insaf (PTI) is looking for options and has invited an IMF team to discuss economic matters. On August 31st the foreign exchange reserves of Pakistan went down to $9.88 billion.
If a bailout package is obtained by Pakistan from the IMF, it will further affect the rupee value against the dollar and other currencies.
Must read: Rupee currency weakens against the US dollar
The rupee was sold between Rs125.3-125.5 in the kerb market and at Rs124.4 in the inter-bank market.
Exchange Companies Association of Pakistan (ECAP) General Secretary Zafar Parachi said that there are two reasons for rupee devaluation one of which is the rumor that it will be depreciated by 5% in the inter-bank market.
During the election days in July, the rupee devalued highest and reached Rs128.17. But after elections rupee strengthened and remained stable at Rs123-124.
The meeting held between Asad Umar and dealers at currency exchange discussed dropping $10,000 limit for individual travelers to $5,000. It was revealed by a dealer that smugglers have often misused the travel limit to which the Finance Minister assured that smugglers will be cracked down by the government to control the leakage.