Rupee falls further by Rs0.50 to reach 223.17

IMF review delay, default risk rise, external debt and liabilities being main causes of depreciation

The rupee has fallen further by Rs0.50 against the US dollar on Friday, the State Bank of Pakistan (SBP) has said.

According to SBP the rupee that had closed at 222.67 on Thursday recorded a depreciation of 0.22 percent to reach 223.17 on the last working day of the week.

The local currency has depreciated by Rs1.75 or by 0.78 percent during the current week.

The rupee was recorded at the all-time highest value of Rs239.94 per dollar on July 28. It showed depreciation for some time till it reached Rs239.71 per dollar on September 22 closest to the highest value. From September 23 to October 11 the value of the rupee fell continuously to reach Rs217.79 on October 11. Since then the prices have been moving up and down close to the 220 mark.

The talks with the International Monetary Fund (IMF) for the revival of the 9th review have been stalled. According to reports the IMF has expressed discontent over the flood expenses of the government. Under the program IMF’s mission was to visit Pakistan in October and Pakistan was to receive $1.2 billion by November 3.

So far the date has not been finalized for Fund’s arrival in Islamabad but according to reports it has been linked with the finalization of the macroeconomic framework with necessary adjustments.

Pakistan’s assessed risk of default as measured by the 5-year credit default swap (CDS), touched 75.5 per cent just days earlier due to uncertainties over the IMF ninth review and the development is anticipated to annoy market emotions.

The external debt and liabilities of the country have also decreased to $126.914 billion in September this year. The value was $130.196 billion on June 30 this year. Therefore a decline of $3.282 billion has been recorded in Pakistan’s external debt and liabilities.

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