The rupee suffered a severe loss against the dollar in the interbank and open markets on Thursday as a result of the lifting of an unofficial cap on the dollar exchange rate.
Today’s intraday trade in the interbank market saw the rupee plummet as it lost more than Rs24, the most since July 2022.
Many people assumed that the government was controlling the exchange rate because, for the past few months, the local currency had maintained its position in the interbank market and had not declined as analysts had predicted.
According to data from the State Bank of Pakistan, the dollar closed at Rs230.89 the day before. However, during intraday trade today, the dollar was trading at Rs255 in the interbank market.
The interbank rate changed by Rs24.11.
The rupee hasn’t dropped this much against the dollar since it reached Rs239.94 on July 28, 2022, in the interbank market.
On the other hand, ECAP data revealed that the dollar was being sold at 255 during the intraday session after losing Rs12.
Capital market expert Muhammad Saad Ali while talking to local media on the developments in the financial markets said that “the SBP is seemingly adjusting the exchange rate to the market rate – closer to open market to address the widening difference between the official and open market rate and to curb the flow of dollars through the informal market.”
To assure the continuation of the International Monetary Fund’s (IMF) loan program, which has pushed Pakistan toward a market-determined currency rate, he continued, this is a crucial step.