Pakistani rupee slumps further against UAE dirham

Pakistani rupee slumped to nearly 50.8 against the UAE dirham on Thursday morning after the US dollar and dirham strengthened due to Federal Reserve’s hawkish policy to contain inflation.

The rupee fell from 50.49 on Wednesday to 50.79 versus the Emirati dirham on Thursday morning, pushed lower by the strengthening of the dollar and political uncertainty in Pakistan, according to xe.com.

The forex industry executives expect political uncertainty in the country will keep the rupee under pressure and the South Asian currency will likely weaken further.

In addition, falling foreign exchange reserve will also put pressure on the rupee, which lost around 3.9 per cent last month.

Pakistani President Arif Alvi dissolved the country’s parliament on recommendations of prime minister Imran Khan last week as opposition parties tried to oust him through a no-confidence vote which he was poised to lose. All eyes are now fixed on the Supreme Court, which has taken a suo moto notice about the dissolution of parliament.

“With the State Bank of Pakistan keeping key interest rates unchanged and inflation at record high levels, we expect the Pakistani rupee to depreciate further,” Hasan Fardan Al Fardan, CEO of Al Fardan Exchange, has said.

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He said inflation, global commodity prices, political stability and balance of payments will dictate the Pakistani rupee’s movement going forward.

Nagesh Prabhu, deputy general manager for Treasury at LuLu Exchange, has predicted the rupee falling to 50.9 and 51 against the dirham in the coming days.

waheedabbas@khaleejtimes.com

• Pakistan
• Dubai