Pakistan is witnessing a difficult economic situation, as foreign exchange reserves are no longer sufficient except to pay the value of imports for a period of about three weeks, in light of seemingly endless efforts to deal with foreign debts.
The Pakistani currency lost 24.11 rupees in the official interbank market on Thursday, to 255.43 rupees against the dollar, according to several sources.
Top Line Securities reported: Topline Securities For financial brokerage, the decline in the value of the rupee amounting to 9.6 percent is the second largest decline in one session.
The previous official decline of 240 rupees was recorded in July 2022 when Pakistan’s long-troubled economy was devastated by political chaos and devastating floods.
In 2019, the government of former Prime Minister Imran Khan negotiated a multi-billion dollar lending package from the International Monetary Fund.
But the economy slumped when Khan abandoned his pledge to cut subsidies and market interventions that had eased the cost of living crisis.
Prime Minister Shahbaz Sharif, who replaced Khan after a no-confidence vote in the latter last spring, hesitated to fulfill the terms of the loan in light of his declining popularity.
The head of the Association of Pakistan Currency Exchange Companies, Zafar Paracha, said in a report to AFP that the cap was lifted on Wednesday “in consultation with the central bank”.
In turn, the CEO of “Top Line Securities”, Mohamed Suhail, told AFP, “Inflation will rise further.”
=Pakistan suffers from a major shortage of foreign currencies as a result of its increasing demand for the dollar.
Thousands of shipping containers loaded with raw materials needed for industry, foodstuffs and medical equipment were stuck in the port of Karachi after banks refused to guarantee suppliers’ transactions in dollars.
Pakistan also experienced nationwide power outages this week as a result of a cost-cutting measure, which is estimated to have cost the textile industry $70 million per unit.
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