This was the fourth successive day the rupee fell against the US dollar.

As per the State Bank of Pakistan (SBP), the PKR closed at 174.19 against the USD after a day-on-day depreciation of Rs1.26 or 0.72%. On Wednesday, the PKR had dropped to 172.93 against the USD.

The rupee has lost nearly 9% of its value against the US dollar calendar-year-to-date, but almost 13% since its recent high achieved on May 7.

Pakistan's rupee weakens again, ends near 173 against US dollar

“News regarding the IMF programme delay is causing uncertainty in the market,” Tahir Abbas, Head of Research at Arif Habib Limited (AHL), told Business Recorder.

The market has been eagerly waiting for the IMF announcement, under which Pakistan would receive $1 billion.

However, despite the delay, Abbas remained positive.

“Improved Current Account Deficit (CAD) figures are also expected, alongside financing from Saudi Arabia and ITFC that would also improve the foreign exchange position,” said Abbas. “However, despite economic indicators moving in the right direction, negative sentiment owing to ambiguity over IMF negotiations is leading to PKR depreciation."

Abbas said that the rupee would reverse its downward slide as soon as uncertainty regarding the IMF programme ends. “PKR will move back to 170 against the USD,” said Tahir.

This article was first published in Business Recorder on Nov 11, 2021