*Pakistan’s rupee extended its decline for a third successive session onMonday as depleting foreign exchange reserves and uncertainty over revivalof the International Monetary Fund (IMF) programme mounted pressure on thelocal currency. Resultantly, rupee depreciated by 0.48% against the USdollar in the inter-bank market.*
As per the State Bank of Pakistan (SBP), the rupee closed at 187.53 after aday-on-day fall of 90 paisas, or 0.48%. On Friday, the rupee had closed at186.63 after a depreciation of 0.5%.
Following the recent depreciation, rupee is just 65 paisa away from itsall-time low of 188.18 recorded on April 7, 2022.
Oil priceslink,a major determinant of currency parity, slipped on Monday alongsideequities and weighed down by a strong dollar and demand concerns on theback of continued coronavirus lockdowns in China, the world’s top oilimporter.
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Arif Habib Limited Head of Research Tahir Abbas said uncertainty on the IMFfront is the primary factor driving rupee’s depreciation against thegreenback. Uncertainty over the programme also resulted in selling pressurein Pakistan stocks, which plummeted throughout the day as well.
“According to preconditions, the global lender wants Pakistan to end thesubsidy being given on oil and energy prices,” he said. “Moreover, friendlycountries will also extend aid only when the IMF programme is revived.”
