The Pakistani rupee’s value dropped for the third day due to looming debt repayments in June, fiscal year-end. Analysts anticipate further devaluation if loan rollovers and refinancing are delayed.
In the inter-bank market, the rupee fell 0.12% to a three-week low against the dollar, while in the open market, it recovered 2.34% due to tighter government regulation.
Mustafa Mustansir, from Taurus Securities, maintained his forecast of the rupee falling to Rs295/$ by June’s end. He voiced concerns over a sharp devaluation due to the government’s upcoming foreign loan repayments of $3.6 billion.
State Bank of Pakistan Governor Jameel Ahmad confirmed the country’s due payment of $3.6 billion in June, with $2.3 billion expected to be rolled over. If delayed, this could pressure the rupee amidst diminishing foreign reserves, currently at $3.9 billion.
Read: No Plan for Debt Restructuring: SBP’s Governor Clarifies
Malik Bostan, President of the Exchange Companies Association of Pakistan, stated that the rupee’s significant appreciation was due to commercial banks supplying currency dealers with $5 million at the central bank’s behest. He predicted the exchange rate to drop to Rs295/$ soon.
Following the rupee’s recovery, gold prices fell around 2% to a six-week low, attributed to the exchange rate’s influence on gold pricing. Meanwhile, gold prices in the international market fell slightly by $2 to $1,961 per ounce.
