According to analysists panic buying of the dollar by commercial banks led to weakening of the local currency
Karachi: The US dollar appreciated all-time high of Rs222 against Pakistan rupee in the interbank market on Tuesday.
According to the Forex Association of Pakistan (FAP), the dollar was up Rs8.8, or 4 per cent, against the previous day's close of Rs215.20 to reach Rs224 around 2:30pm.
Interbank closing #ExchangeRate for todayhttps://t.co/pjx8HeEs52 pic.twitter.com/yp6mrPuyaq
— SBP (@StateBank_Pak) July 19, 2022
However, it closed at Rs221.99, appreciating 3.1pc, according to the State Bank of Pakistan (SBP).
Accoridng to central bank's tweets, the recent movement in the Rupee is a feature of a market-determined exchange rate system. Under this system, the current account position, relevant news items, and domestic uncertainty together determine daily currency fluctuations.
Recent Rupee depreciation against the US dollar is also in large part a global phenomenon. Globally, the US dollar has surged by 12 per cent in the last six months to a 20-year high, as the Fed has aggressively raised interest rates in response to rising inflation.
Like most advanced and emerging market currencies across the world, the Rupee has depreciated against the US dollar since Dec 21. It has depreciated by 18pc over this period.
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