As the economic crisis continues in Pakistan, the Pakistani rupee has fallen to a new low against USD. It slid to Rs 227.88 against the US dollar in the interbank market, as per the report of The Express Tribune.
The latest drop came after the Pakistan government failed to make any headway in its talk with the International Monetary Fund (IMF) for the revival of its stalled USD 6.5 billion loan programme. The Pakistani currency has lost 4.42 per cent aggregate of its value in the last three months, compared to Rs 217.79 in early October.
The country’s foreign exchange reserves have decreased to USD 6.5 billion, which is only enough to fund imports for 25 days while the IMF plan is still on hold, according to The Express Tribune.
The interbank exchange rate of Rs 227.88, according to financial analysts, is not the true worth of the rupee. The illicit market, however, offered the US dollar for as much as Rs 270.
One of the main causes of the delay in the IMF program’s restart was the attempt by Finance Minister Ishaq Dar to artificially regulate the value of the rupee in the interbank market. According to The Express Tribune, the lending institution has requested that the government allow commercial banks and market forces to establish the rupee’s parity with the dollar.
The government’s forced restriction on imports due to declining foreign exchange reserves has had a detrimental effect on the nation’s economic operations.
Several industrial facilities have either partially or entirely shut down as a result of the lack of imported raw materials.
In addition, Pakistan’s foreign debt obligations for the following six months total USD 13 billion, raising worries that the nation may not be able to meet these payments.
According to The Express Tribune, the IMF program’s restart is the only way for the country to avoid default.