Rupee slides for 12th straight session

The rupee continued to depreciate against the dollar on Tuesday, losing another Rs1.1, or 0.38 per cent, in the interbank market. According to the State Bank of Pakistan, the dollar traded for Rs286.39 in the interbank at the day’s end. It had closed yesterday at Rs285.29. In the open market, the dollar was changing hands for Rs287.5 during the afternoon, according to the Exchange Companies Association of Pakistan (ECAP). This is the 12th straight session in which the rupee trended downward. Since October 20, it has shed 2.9pc. The downward trajectory ate into the recovery that the rupee experienced in September, following a clampdown on illegal currency markets. Some bankers believe that a short supply of dollars and poor growth of exports could further weaken the local currency. Experts said the announc­ement of general elections on Feb 8, 2024, has attached some additional uncertainty in the political and economic scenario. Currency experts said the demand has been high as the importers were keen to buy to save the future cost of dollars which may go up. Raza Jafri, head of equities at Intermarket Securities, said that the rupee has been depreciating steadily after the REER-based valuation — real effective exchange rate measures the value of a currency in relation to its major trading partners — crossed 100.