According to the Pakistani Forex dealers on Wednesday, the greenback was being sold above rupees 189 in the open market. The US dollar on the other day closed at rupees 187.53 in the interbank market.
Meanwhile, the State Bank of Pakistan’s foreign exchange reserves fell by USD 328 million during the week that ended on April 23, data released by the central bank showed.
Economic experts say the surging dollar has shattered the confidence of the rupee-based economy and its stakeholders. The gloomy macros will continue to put pressure on the local unit.
The crisis in the Forex market is primarily due to a delay in the International Monetary Fund (IMF) loan program. The bailout has been on hold since June 2021, mainly due to US pressure on the international lending body.
The delay in the resumption of the program has ceased the flow of foreign currencies into Pakistan, precipitating the current crisis.
Accordingly, the country’s foreign exchange reserves have depleted to a critical level and mounted pressure on the rupee.
The rupee partially recovered against the US dollar after the Pakistan Muslim League (Nawaz) formed the coalition government during the first half of April, after the former administration led by Imran Khan was overthrown, which was blamed on the US-backed ‘regime change plot’.
He openly blamed the administration of US President Joe Biden for his ouster.
After coming to power in 2018, Khan adopted anti-American rhetoric, while expressing a desire to align Pakistan more closely with China and more recently with Russia, which created hurdles in his way to streamlining the country’s fledgling economy.