The Pakistani rupee on Tuesday made a historical drop of Rs4.00 in a single day and surpassed Rs204 against the US dollar for the first time ever in the inter-bank market.
It was available for sale at Rs204 at around 1:40pm in the market on Tuesday, after closing at Rs200.06 against the greenback on Monday, according to the central bank.
This was the third consecutive workday free-fall of the rupee.
The Pakistani currency has faced renewed pressure after foreign currency inflows from overseas Pakistanis through their Roshan Digital Account (RDA) dived to a 15-month low at $189 million in May 2022.
Data compiled by Ismail Iqbal Securities from State Bank of Pakistan (SBP) reports suggests that overseas Pakistanis’ investment into Naya Pakistan saving certificates through RDA plunged to a 21-month low at $13 million in May.
The inflows through RDAs – which stood at a strong $290 million in March which was the last month of the PTI government – continued to drop for the second consecutive month in May.
Former prime minister Imran Khan, in collaboration with the central bank, introduced RDA for overseas Pakistani in September 2020 in an effort to stabilize the country’s foreign exchange reserves.
Non-resident Pakistanis have so far deposited over $4 billion through RDA in the past 21-months.
However, the reserves have depleted by over $7 billion in the past six-month to criticality low levels of six-week import cover at $9.72 billion at present.
Pakistan is expected to resume the International Monetary Fund’s (IMF) $6 billion loan programme in June after the incumbent government presents the annual budget for the next fiscal year.
The budget presentation is scheduled for June 10 in the Nationality Assembly.
The prolonged delay in the revival of the IMF programme has continued to mount pressure on the rupee. The programme has been stagnant for the past year.