KARACHI: Pakistan’s rupee recorded a significant loss against the US dollar during intra-day trading on Monday, falling to the 204 level in the inter-bank market amid uncertainty pertaining to revival of the International Monetary Fund(IMF) programme.
In the morning session, the rupee was being quoted at 204, a significant intra-day fall of Rs1.65 against the greenback.
On Friday, the local currency had closed at Rs202.35.
The fall on Monday comes as Finance Minister Miftah Ismail in an interview said that the IMF has expressed concern about the country’s recently unveiled budget, but the government is confident it can make changes to satisfy the lender.
“There are still some concerns the IMF has about our budget and numbers and stuff like that,” Ismail said on Saturday in Islamabad.
Pakistan is looking to getting a staff level agreement with the IMF this month, added the finance minister, hoping for its next tranche of the Extended Fund Facility that would pave way for an inflow of $900 million. In addition, the successful revival of the programme would also open doors to other lenders that have so far shown reluctance until the IMF’s facility is revived.
An analyst said the comment has been seen as a negative by the currency market that is already on edge.
“Miftah’s statements are negatively impacting market sentiment,” Abdullah Umer, analyst at Ismail Iqbal Securities, said.
However, along with Miftah’s statement, there are a number of other factors impacting Pakistan’s currency.
During the previous week, the rupee depreciated nearly 2.2% against the US dollar, shedding value in three of the five sessions as falling foreign exchange reserves, Moody’s downgrade of Pakistan as well as five of its major banks’ outlook took toll on the currency market.