KARACHI – Pakistani rupee plunged drastically to approach an all-time low,days after currency exchangers lifted a cap on the rupee-dollar rate.
Earlier during the day, the currency was trading at 231 while the greenbackincreased by Rs 24 and was being quoted at 254.75 during intra-day trading.
The massive depreciation of over 9 percent during the trading session ofthe local currency is the largest single-day decline in decades.
It was also reported the country’s central bank is adjusting the exchangerate to the market rate to address the widening difference between theofficial and open market rate.
The recent development comes as the coalition government agreed to thestringent conditions set by the US-based global lender to let the exchangerate be set by the market.
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Amid the worrisome situation, money market pundits claimed the rupee wasbound to plunge in the coming days as the cash-strapped nation moved tomeet harsh conditions demanded by the International Monetary Fund (IMF) forthe ninth review of the crucial programme.
Earlier this week, money exchange companies have come up with a counterstrategy and decided to remove the cap on the US dollar amid growingartificial demand for the greenback in the market.
The local currency depreciation was also linked with depleting foreignexchange reserves held by the country’s central bank.
