KARACHI: Crossing the barrier set by the State Bank of Pakistan (SBP), the US dollar increased to Rs103.45 at a six-month high.
Most of the trading was done at Rs103.20 though the US currency slipped slightly below Rs103 in the second half. Dollar’s demand from importers has been rising, but the central bank was defending the value of rupee.
In the last three-month period, prices of all goods including oil and its by-products decreased sharply. Crude oil was $112 per barrel in the beginning of this fiscal year. Now it has slumped to around $81 per barrel.
The decrease has impacted the entire international market, particularly the oil by-products which have declined between 25 and 30 per cent in the last three months. Lenders said the local currency is overvalued against the US dollar. It may see a sharp devaluation if the central bank stops influencing the market.
The US currency started coming down against the local currency since March this year and touched as low as Rs97, but then settled below Rs100 for a longer period. However, with the beginning of new fiscal year and political agitation in the country, the situation turned in favour of the greenback.