KARACHI: The rupee further plunged against the US dollar on Friday in thekerb market, touching a new low of Rs119.05.
This comes on the heels of the State Bank of Pakistan’s decision earlierthis week to introduce identification requirements for all foreign currencybuy and sell transactions equivalent to $500 or above on exchange companiesand directed them to retain the copies of identification documents tocomply with anti-money laundering rules.
As per reports, the rupee was also being traded at Rs119.5 to the dollar ascurrency dealers exploited the situation.
On Thursday, the rupee in the kerb market had closed at Rs118.55 and itdeclined further to Rs119.05 on Friday.
But the rupee remained stable against the dollar in the inter-bank marketat Rs115.61 according to the central bank.
Zafar Paracha General Secretary Exchange Companies Association of Pakistan(ECAP) told local newspaper that the shortage of dollars was causing therupee to plunge further against the greenback.
The central bank’s decision on Monday immediately impacted the supply ofdollars in the kerb market and speculation that another round ofdepreciation also drove the weakening of the rupee.
Mr Paracha said people could be holding onto dollars since they wereexpecting another round of depreciation before the upcoming generalelections and change of elected government this year.
He added that Ramazan historically for currency dealers received higherremittances and it was strange that they receive low inward remittancesduring this holy month.
Also, on Tuesday, credit rating agency Moody’s projected the rupee couldplunge by 7.75 percent and touch Rs125 to the dollar by June 2019.