The Pakistani Rupee (PKR) fell to a new all-time low versus the US Dollar (USD) today in the interbank market, posting losses. During today’s open market session, it dropped 49 paisas versus the greenback, reaching an intra-day low of Rs. 180.55 against the USD.
It declined by 0.28 percent versus the US dollar today, ending at Rs. 180.57, after losing 63 paisa in the interbank market on Thursday, 17 March, and closing at Rs. 180.07.
Oil prices surged 8% on Thursday, extending a streak of dramatic daily swings as the market rebounded from three days of losses with a renewed focus on supply restrictions as a result of Russian sanctions, while the rupee finished at yet another historic low versus the dollar.
In recent weeks, oil benchmarks have been at their most volatile since the mid-2020s. Prices have increased again on expectations that the energy market would soon be pressured, after decreasing as purchasers cashed in on the run-up. Brent oil futures had risen to $109.1 a barrel at the time of writing, while US West Texas Intermediate (WTI) crude had reversed losses and risen to $104.3 a barrel.
Brent has traded as high as $139 and as low as $98 during the previous eight trading days, implying a massive $40 differential. Many investors have already left, laying the path for even more wild price fluctuations in the weeks ahead.
In Pakistan, the State Bank of Pakistan (SBP) reported on Thursday that the country’s total liquid foreign exchange reserves fell by $385.3 million to $22.28 billion on March 11, 2022, compared to $22.66 billion the previous week. SBP’s reserves fell by $380.6 million (-2.34%) to $15.83 billion last week, down from $16.21 billion the week before.
In a tweet earlier today, Asad Rizvi, the former treasury chief of Chase Manhattan Bank, discussed how Pakistan’s foreign exchange reserves had declined by $381 million to $15.832 billion, citing the local unit’s performance. This is the sixth prudent drop since February, and with oil weighing heavily, a bounce is imminent.
“Ongoing domestic/political instability, as well as negotiations with the IMF, are giving jitters that do not favors [the] PKR,” he continued.
In today’s interbank currency market, the PKR battled against most other major currencies, reporting losses. It depreciated by 13 paisas against the Saudi Riyal (SAR) and the UAE Dirham (AED), 80 paisas against the Euro (EUR), 89 paisas against the Canadian Dollar (CAD), and Rs. 1.35 against the Australian Dollar (AUD) (AUD).