SBP issued a press statement supporting the fall in the value of the rupee. “The current exchange rate is broadly aligned with the economic fundamentals,” according to the SBP statement issued on Wednesday.
The move was surprising because the central bank has been supporting the rupee against the dollar by intervening in the open market during the last few years of this government.
The finance minister has been a big supporter of a strong rupee and since taking office in 2013, the PML-N has been trying to keep the rupee stable.
However, his stance has been bitterly opposed by exporters who think artificial support to the rupee is creating problems for Pakistan’s exports at a time when regional competitors have devalued their currencies to support their exports.
Analysts say the government wanted to continue its stable rupee policy but it has recently come under severe pressure to devalue the rupee because of sharp rise in imports and decline in exports.