Pakistan currency falls to a record low of 270 against US dollar

Agencies | Islamabad                                        

The Daily Tribune – www.newsofbahrain.com  

Pakistan's currency plummeted to a record low of 270 against the US dollar as the government surrendered its control over the exchange rate in order to meet the demands of the International Monetary Fund (IMF) for a bailout. Notably, Pakistan is facing, what is being called its 'worst-ever economic crisis' since independence.

The currency was devalued by 7.50 PKR (or 2.77%) to an all-time low at 270.10 PKR against the US dollar on the third consecutive day, a report by The Express Tribune said.

The Pakistani currency has fallen by a massive Rs 35 against the US dollar in the last four days. It declined by 39.21 PKR (or 14.50%) in the three days till today compared to Wednesday's close at 230.89 PKR.

The Pakistani rupee declined after the government removed an unofficial cap on the USD-PKR exchange rate in order to revive the stalled International Monetary Fund (IMF) loan programme.

"The wide gap between demand and supply of the greenback in the system pushed importers to pay 270 PKR per dollar," KASB Securities Head of Research Yousuf Rahman told The Express Tribune.

Pakistan has been hit by the worst economic crisis, grappling with decades-high inflation, lower GDP growth, and depleting forex reserves. The country is desperately looking for funds from the IMF to avoid default but the international financial agency has demanded some concrete reforms which also include an increase in petroleum prices.

Pakistan Prime Minister Shehbaz Sharif has also formed a National Austerity Committee (NAC) to suggest ways to lower the cost expenditures of various departments. The committee has proposed a 10 per cent salary cut for government employees and a 15 per cent cut in expenditures of ministries and divisions, as per local media reports.