US Dollar has soared to Rs 168 in Interbank market in Pakistan today after yesterday closing at Rs 161. The upward pressure on USD is triggered by multiple factors arising from the Coronavirus related crises.
Some of the key factors exerting pressure on PKR are decreasing exports, pressure on remittances from global coronavirus and record low oil prices. Lastly reduction in discount rate has resulted in outflow of hot money from Pakistan to the tune of USD 1.8 billion.
Due to above factors, US dollar has soared to Rs 168 in Pakistan. It is expected to rise above Rs 170 and may even touch Rs 185 in coming few months. The only positive impact will come from decreasing import bill driven by global oil price reduction as well as supply chain constraints that will hamper the delivery of imported items.
However, Increase in dollar rate will put pressure on inflation rate. Further pressure on CPI may come from lock down resulting in limited supply of essential items in the markets and thus raising prices across the country. Coming weeks are critical and will reveal the full economic cost of Coronavirus on fragile economy of Pakistan.
USD Rate Update 27th March 2020
USD touched Rs 170 in interbank market during the day before closing the day at Rs. 168.75