Published On: Fri, Jan 3rd, 2014

Pak Rupee Lost 8pc VS US Dollar in 2013



Corporate News (Pakistan News) Pak Rupee

Corporate News (Pakistan News)

During the calendar year 2013 Pakistani Rupe disappointingly lost 8 percent of its value if compared to the US dollar. The main reason for this declination was due to the rapid depletion of the foreign exchange reserves of the State Bank. This trend was also witnessed in the inter-bank and open markets.

This value of 8 percent was further aggravated to 12 percent after the formation of the new government due to the immense pressure of the speculative forces. However the government after pairing up with the State Bank, private banks and currency dealers managed to hold this escalation of depreciation of the Pak Rupee against dollar in the last couple of months by reducing the size of depreciation from 12pc to 8pc.

“We traded dollar at Rs105.35 at the end of the day while the price of the greenback the same day last year was Rs97.15,” said Atif Ahmed, a currency dealer in the inter-bank market. He said the local currency depreciated by 8.4pc, or Rs8.20, against the dollar since Dec 31, 2012 to Dec 31, 2013.

The dollar story in the open market is not different. On Tuesday, the dollar was ended at Rs105.30 with a depreciation of about 8pc against the dollar. “On Jan 1, 2013 the dollar was traded at Rs98.40 while it shot up to Rs111 in the second half of this calendar year, then finally settled at Rs105.30 on the last day of the year,” said Anwar Jamal, a currency dealer in the open market.

The International Monetary Fund posed great pressure on the country’s reserves despite an agreement between the 2 entities for over $6 billion.

The greatest threat was the fact that the reserves of the private banks were more than the reserves of the State Bank. The SBP reserves valued to $8.987bn at the end of the previous year while this value depreciated to to $3.192bn on Dec 20, 2013, a loss of $5.795bn. However Private Banks reserves were almost the same if compared to the last years standings. Private banks’ reserves were $4.897bn against last year’s $4.871bn.

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