subject: Pakistan Rupees At A Record Low- Reports Dollars Magazine [print this page] Pakistan rupee dropped to a record low of Rs84.65 Tuesday as importers rushed to buy US dollar to make oil payments, Forex news portal of Dollarsmagazine reports.
Buy rate of US dollars at commercial banks was Rs84.33 and sell rate was Rs84.52 , the State Bank of Pakistan (SBP) said.
The State Bank of Pakistan stopped sell foreign exchange to banks for financing the crude oil imports on December 21 of 2009. Because of this measure Pakistan rupee lost 3 paisa or 0.6 per cent of its value within 4 days against the dollar as banks began to buy US dollars in advance.
Dollarsmagazine had anticipated a further decline in the rupee value as Pakistan start financing crude oil imports. Crude imports stood at $4 billion or more than 40 per cent of the overall petroleum imports of $9.5 billion in FY09.
Foreign debt servicing in October-December 2009 was estimated well above a billion dollars, the major share of which was paid in December. In July-September Pakistan spent $1.2 billion on foreign debt servicing despite a roll-over of $450 million.
In July 2008, the State Bank had decided to provide foreign exchange to banks for financing import of crude oil and petroleum products to keep the exchange rates stable amidst inconsistency triggered by international financial crisis and recession. But it stopped providing foreign exchange for financing of import of furnace oil from February 2009 and for that of petroleum products from July.
Now it has stopped selling foreign exchange for crude oil as wellreportedly to meet one of the conditions of the IMF standby loanthus restoring the pre-July 2008 arrangements wherein banks were responsible for arranging foreign exchange to finance imports of both crude oil and all petroleum products.
Dollarsmagazine report that Pakistan rupee will continue to remain under pressure as banks scramble to arrange foreign currency for importers of petroleum products and crude oil. Earlier, the central bank was using its foreign exchange reserves for importing crude.
by: Juhiesmith
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