Karachi: The Pakistani currency depreciated by Rs 0.60 to an all-time low of Rs 188.66 against the US dollar in the interbank market on Tuesday, as looming uncertainty over the resumption of the International Monetary Fund (IMF) loan programme took a toll on the local unit, Geo News reported.
The local currency surpassed its April 7 record low of Rs 188.18.
Currency dealers believe that a delay in the IMF programme, lack of immediate financial support from friendly countries, depleting foreign exchange reserves and surging trade deficit kept the pressure on the domestic currency.
The new government’s reluctance to remove subsidies on fuel and electricity — which are the pre-conditions for the revival of the IMF programme — dampened investors’ sentiment.
Moreover, investors are concerned about the falling foreign currency reserves — as the inflows from remittances and export proceeds are not sufficient to meet the market demand — and growing external debt payments and soaring imports. This is putting pressure on the rupee, Geo News reported.
There is also ambiguity over the financial support from Saudi Arabia, UAE and China. The political temperature was also rising following the former Prime Minister Imran Khan’s announcement that he would march with his supporters to Islamabad after May 20 to demand new elections.