Rupee's downward spiral continues unabated as it hits 177.89

• The local currency closes at Rs177.89 against the greenback in the interbank market surpassing Friday’s record low of Rs177.71.
• Financial analyst Khurram Schehzad says "it is important for the currency to remain stable as fluctuations are normal."
• The rupee has depreciated by 12.91% since July 1, 2021.

KARACHI: Pakistani rupee continued to slide against the US dollar on Monday with a fresh decline of Rs0.18 owing to the constant supply-side pressure.

The local currency closed at Rs177.89 against the greenback in the interbank market surpassing Friday’s record low of Rs177.71 due to increased demand from the importers and a lack of sufficient supplies.

Speaking to Geo.tv, Alpha Beta Core CEO Khurram Schehzad said that the nominal fluctuations are normal.

“It is important for the currency to remain stable,” he added.

The rupee has maintained the downtrend for the past seven months. It has lost 16.82% (or Rs25.62) to date, compared to the 22-month high of Rs152.27 recorded on May 14.

With a fresh decline of 0.10%, the rupee has depreciated by 12.91% (or Rs20.35) since the start of the current fiscal year on July 1, 2021, data released by the central bank revealed.

Earlier, analysts had predicted that the Pakistani rupee will lose more ground against the US dollar during the next week if the State Bank of Pakistan (SBP) does not intervene till the completion of the sixth review of the International Monetary Fund's (IMF) $6bn loan programme.

Currency dealers said that the rupee continued to suffer from higher demand for dollars from importers, particularly in the absence of inflows from the central bank and other sellers. In addition, a wide trade deficit caused by hefty imports and global oil prices were a threat to currency stability.

“There is still some demand pressure and that could let the rupee weaken further unless there is liquidity intervention in the foreign exchange market. The rupee seems to be trading at 178-179 levels going forward,” a currency dealer said.

Schehzad added that the local unit is expected to close within a range of Rs170-180 by the end of the calendar year 2021.