US dollar crosses Rs200 mark in open market

F.P. Report

KARACHI: The mighty US dollar continued its impressive run against a timid Pakistani rupee smashing the magic mark of Rs200 in the open market.

The defenceless rupee was in dire straits against the greenback as its value has skyrocketed by two rupees in the open market and by massive Rs2.65 in the intrabank market on Wednesday.

In the open market, the dollar appreciated by two rupees tearing apart the Rs200 barrier and stopping at Rs200.50.

In the intrabank trade, the dollar soared to new historic high against the Pakistani currency as it shot up to Rs198.39, up by two rupees and 65 paisas at the close.

The greenback has climbed up by nearly Rs16 in its value since April 11 last, when Shehbaz Sharif was sworn in as the new prime minister. The dollar rate on April 11 was Rs182.93.

Yesterday, the Pakistani currency also got a ruthless thrashing by the US dollar after crossing the Rs196 mark for the first time in country’s history but was settled at Rs195.74 at the close of business.

The experts said that the rise of the US dollar was due to the continued pressure from the import bill on the Pakistani rupee and the depleting foreign reserves.

FPCC Vice-President Shabbir Mansha said that if the government failed to check the devaluation of rupee at this rapid pace, then a tsunami of inflation would sweep the country.

He called upon the government to take harsh decisions in order to arrest the freefall of the Pakistani currency. He demanded of the government to immediately intervene to stop the freefall of the rupee.

In a related development, the International Monetary Fund (IMF) will begin talks with Pakistani officials on Wednesday over the release of crucial funds, a process slowed by concerns about the pace of economic reforms in the South Asian country.

Pakistan has repeatedly sought international support for its economy, which has been hit by crippling national debt, galloping inflation and a plummeting rupee.

The talks will be held in the Qatari capital Doha, Pakistan’s finance ministry said, and are expected to continue into next week.

A major sticking point is likely to be over costly subsidies — notably for fuel and electricity — and Finance Minister Miftah Ismail said he wants the two sides to “find a middle ground”.