Dollar touches all-time high against rupee

ISLAMABAD:

The Pakistani rupee continued its downward trend on Thursday as the U.S. dollar appreciated by 9 paisas in the interbank market, reaching a record high of Rs305.54, according to the State Bank of Pakistan (SBP)¹.

The rupee has been under pressure from a widening current account deficit, which stood at $1.8 billion in July 2023², rising inflation, which reached 9.7% in August 2023³, and falling foreign exchange reserves, which dropped to $12.4 billion as of August 20, 2023.

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The SBP has devalued the currency by about 40% since December 2017 to support exports and curb imports. The rupee has lost 12.1% of its value against the dollar in July and August 2023 alone.

The depreciation of the rupee has increased the cost of imports and debt servicing for Pakistan, while also fueling inflation and uncertainty in the economy.