KARACHI: The US dollar shot up to Rs121.5 in the interbank market after it closed at Rs119.84 on Monday.
The greenback had reached a record-high of Rs121 on June 11 — the State Bank of Pakistan (SBP) had attributed the movement to a gap between foreign exchange demand and supply in the interbank market. The dollar has increased by over Rs15 in the past six months.
According to SBP, despite the continued growth in exports — 13.3 percent in July-April Financial Year (FY) 18 — and some uptick in remittances, growing imports pushed the current account deficit to US$ 14.0 billion during the first ten months of FY18, which is 1.5 times the level of deficit realised during the same period last year.
The central bank had said the 'market-driven adjustment' in the exchange rate along with other recent policy measures is expected to contain the imbalances in the external account, thereby containing aggregate demand and also facilitating the prospects for generating non-debt creating inflows.
In March, the US dollar had shot up by Rs4.93 in the inter-bank market to hit a high of Rs115.5 before coming down to Rs115 at the close of business. Since December, the rupee has fallen by about 14 percent.