Pakistani rupee trades at record low of 90.35 to dlr

[Omar1984]

All thanks to Zardari and his PPP.

 

[regular]

Yes! thanks to the Ghaddari and his Thugz /looterz Tolaaz.......

 

[patna_ke_presley]

The Pakistani rupee traded at a record low of 90.42 on Thursday for the second consecutive trading session amid increased import payments, especially of oil, and because of a negative outlook on the country’s economy, dealers said

Rupee trades at new record low vs dollar | Business | DAWN.COM


“There are some oil import payments but there are few inflows of dollars and generally there is rising concern about the direction of Pakistan’s economy,” said a bank dealer.

The rupee traded at its previous record low of 90.35 to the dollar on Wednesday and dealers said it traded at 90.48 in the TOM (one-day forward) market.

The rupee ended at 90.40/45 to the dollar, compared with Wednesday’s close of 90.27/31.

There are concerns on the economic front as the country’s current account deficit stood at $2.104 billion in July-Nov compared with $589 million in the same period a year earlier.

The deficit is likely to widen further in the coming months because of debt repayments and a lack of external aid.

Islamabad has to start paying back an $8 billion International Monetary Fund loan in early 2012. Without additional sources of revenue, analysts said, its foreign exchange reserves may come under pressure.

More than $1.1 billion is due in the second half of the 2011/12 fiscal year.

Foreign exchange reserves were at $16.77 billion in the week ending Dec 23, compared with a record $18.31 billion as of July 30.

The rupee weakened 4.82 per cent in 2011, after losing 1.53 per cent in 2010.

There are also concerns about rising international oil prices as it was trading around $113.40 a barrel but the risk remained to the upside given geopolitical tensions around Iran and Syria, and calls for strikes in Africa’s biggest producer Nigeria.

Pakistan stocks fell on foreign selling. The Karachi Stock Exchange’s (KSE) benchmark 100-share index ended 1.53 per cent, or 174.09 points, lower at 11,187.88 on turnover of just 29.64 million shares.

In the money market, overnight rates ended at their lowest level of 9.10 per cent, unchanged from Wednesday’s close amid increased liquidity in the interbank market.

Dealers said there were scheduled outflows of 174 billion Pakistani rupees ($1.93 billion) due on Friday.

 

[Abu Zolfiqar]

Well the difference is even after a slowdown ..our growth rate is three times as much as yours.

you dont share a long porous border with a country that is a narco-state, with a raging insurgency and foreign military presence; you havent faced 2 major earthquakes and 2 major floods all within just the past 5-6 years.....have you?

you dont have a spineless govt. that can't even provide basic things like un-interrupted electricity supply.....you dont have the extent of corruption that the establishment does.

so perhaps you should keep that in mind when talking about your growth rate (which has been slowing down too)


yes our growth rate is slow, but the GDP is still growing nevertheless....not anywhere near the level Pakistan is capable of (such as what we saw in mid 2000s) but for now, at least the economy is growing and not shrinking.

Yes currency devaluation has positive effects on exports ..but this effect is highly overrated for example ..you currency has devalued by almost 70% in last 4 yrs..would care to guess out what is the percentage increase in your exports during the same period

the data is readily available....in fact the current account deficit is narrowing --i dont know if this is because of IMF conditions or because the ministries are keen to keep the deficit down.

our current account deficit is not large at all; Fiscal 2010 and 2011 saw increased exports (higher % level in 2010). Meanwhile, we've been seeing steady decrease in imports from 2009.

in 2009, our current account imbalance was approx. $9b whereas by the end of fiscal 2011 it will hopefully be around $1.5 - 2b

...inversely devaluation also has inflationary effect on the economy.

there are many other factors that would affect inflation ---currency deval. isnt the only one

yes there would be cost inflation....Pakistani govt. could create incentives to save money (interest rates, etc.)

ultimately at the end of the day, inflation is one of the obstacles on the way of development. In Pakistan, it has squeezed a section of the population. It needs to be controlled by strategic planning. Domestic production should be encouraged instead of imports; investment should be given preference in consumer goods instead of luxuries, Agriculture sector should be given some subsidies, foreign investment should be attracted once the security environment improves -which it kind of is already...

Economically Pakistan is in a bad shape ..though not yet on 2008 levels ..but unhindered it can regain those levels in a blink .. especially with SBA ending...time to return the $8 Billion to IMF arriving..those foreign reserves will be depleting fast.

it is in tough waters but it isnt the ''end of the world'' or ''doomsday'' the way a few outsiders -with their vested interests -would have you think. On the ground in Pakistan, it's just another day. People are still shopping, still going about, still living their lives.

the govt. cant seem to resist the debt trap temptation; that's unfortunate that a good % of budget goes towards debt servicing......we should try to push to have some of those debts forgiven or re-scheduled.



oh and by the way, foreign reserves are not used to repay external debts to IFIs

 

[ares]

you dont share a long porous border with a country that is a narco-state, with a raging insurgency and foreign military presence; you havent faced 2 major earthquakes and 2 major floods all within just the past 5-6 years.....have you?

you dont have a spineless govt. that can't even provide basic things like un-interrupted electricity supply.....you dont have the extent of corruption that the establishment does.

so perhaps you should keep that in mind when talking about your growth rate (which has been slowing down too)


yes our growth rate is slow, but the GDP is still growing nevertheless....not anywhere near the level Pakistan is capable of (such as what we saw in mid 2000s) but for now, at least the economy is growing and not shrinking.




the data is readily available....in fact the current account deficit is narrowing --i dont know if this is because of IMF conditions or because the ministries are keen to keep the deficit down.

our current account deficit is not large at all; Fiscal 2010 and 2011 saw increased exports (higher % level in 2010). Meanwhile, we've been seeing steady decrease in imports from 2009.

in 2009, our current account imbalance was approx. $9b whereas by the end of fiscal 2011 it will hopefully be around $1.5 - 2b




there are many other factors that would affect inflation ---currency deval. isnt the only one

yes there would be cost inflation....Pakistani govt. could create incentives to save money (interest rates, etc.)

ultimately at the end of the day, inflation is one of the obstacles on the way of development. In Pakistan, it has squeezed a section of the population. It needs to be controlled by strategic planning. Domestic production should be encouraged instead of imports; investment should be given preference in consumer goods instead of luxuries, Agriculture sector should be given some subsidies, foreign investment should be attracted once the security environment improves -which it kind of is already...




it is in tough waters but it isnt the ''end of the world'' or ''doomsday'' the way a few outsiders -with their vested interests -would have you think. On the ground in Pakistan, it's just another day. People are still shopping, still going about, still living their lives.

the govt. cant seem to resist the debt trap temptation; that's unfortunate that a good % of budget goes towards debt servicing......we should try to push to have some of those debts forgiven or re-scheduled.



oh and by the way, foreign reserves are not used to repay external debts to IFIs

External debt is paid in US dollars ..same with export payments etc..where do you think unused USD(ie forex) ends up?

 

[karan.1970]

the data is readily available....in fact the current account deficit is narrowing --i dont know if this is because of IMF conditions or because the ministries are keen to keep the deficit down.

our current account deficit is not large at all; Fiscal 2010 and 2011 saw increased exports (higher % level in 2010). Meanwhile, we've been seeing steady decrease in imports from 2009.

in 2009, our current account imbalance was approx. $9b whereas by the end of fiscal 2011 it will hopefully be around $1.5 - 2b

I think your view on Current account numbers is overly optimistic.. You had a good year last year because of remittances and flood relief money coming in.. 2011-12 is not looking good at all

Current account deficit balloons to $2.1bn in five months

 

[Rafi]

The economy will be a major part of this current govt being kicked out in the next elections. But I am also optimistic - there are signs that parts of the economy are robust.

 

[Abu Zolfiqar]

I think your view on Current account numbers is overly optimistic.. You had a good year last year because of remittances and flood relief money coming in..

Current account deficit balloons to $2.1bn in five months

ok, so i was off by $0.1b (assuming the article is correct; and also based on MY source(s) -- the W.E.O. and IFS)

2011-12 is not looking good at all

let it come, then we'll see....projections are just projections, perhaps IFS estimates are more optimistic than you are

as is always the case with Pakistan, as of late - there's always good and there's always bad. Hopefully govt. will get its act together and undertake the right policies - some which are not always politically popular (e.g. imposition of VAT system)

 

[Tamil Arasan]

you indians of all people should keep your pie-holes shut, considering your own economy is slowing down as well.....(as is the value of your currency)

Well you too should have kept your P-H shut before making this comment, just few weeks back many Pakistani members are commenting on India's lower then expected growth rate of 6.9% (not bad considering the current global situation) saying India's growth story is western propaganda!!!, this, that and so many nasty things, and then immediately next week we saw Pakistan posting worst growth compared to India around 3.5%...first get your house in order before commenting on India, and it applies to us also...

 

[Abu Zolfiqar]

Well you too should have kept your P-H shut before making this comment, just few weeks back many Pakistani members are commenting on India's lower then expected growth rate of 6.9% (not bad considering the current global situation) saying India's growth story is western propaganda!!!, this, that and so many nasty things, and then immediately next week we saw Pakistan posting worst growth compared to India around 3.5%...first get your house in order before commenting on India, and it applies to us also...

i have no reservations about THREADS being opened on Pak's economy; i only take exception to immature POSTS (especially those by these countrymen of yours) that are filled with misinformation and half-truths

and quite frankly, if you dont like what you see on this forum ---then you should go and find another forum to post on

 

[Nothing]

Hey guys ... don't debate(fight ) on you VS me thing...
Currency value degradation is for Pakistan is nothing like what happened in Zimbabwe .. it is just less inflow of foreign exchange .. many reasons behind that .. EU is one of the main customer of Pakistan for export .. those countries are not doing good ..even Pakistan is facing major energy crisis .. IMF loan re-payment....and this year they may miss their export target ..
And volatile political environment .. these all factors are reason behind lack confidence in economy of Pakistan.. and import bill of oil is going higher .. so by nature of free float currency it will adjust it self ...
nothing special... many 2-3 month of stability and proper management of energy crisis will make 85 PKR = 1 USD ...

And for India VS Pakistan economy ... its better we guys leave that discussion .. both countries are suffering because of morons at each level of system..

 

[Punjabbi Munda]

Why didn't Riaz Haq comment in this thread at all?We miss you Mr.Blogger!

 

[karan.1970]

ok, so i was off by $0.1b (assuming the article is correct; and also based on MY source(s) -- the W.E.O. and IFS)

$0.1B ??

You estimated 1.5-2 billion USD deficit for the whole year, where as the 1st 5 months only have resulted in the deficit of 2.1 billion, which would probably end close to 5 billion USD for the whole year, and may be even worse because Pakistan will start paying back the IMF loan starting 2012 (unless it defaults on it).. So you are probably off by over $ 3 Billion

 

[patna_ke_presley]

$0.1B ??

You estimated 1.5-2 billion USD deficit for the whole year, where as the 1st 5 months only have resulted in the deficit of 2.1 billion, which would probably end close to 5 billion USD for the whole year, and may be even worse because Pakistan will start paying back the IMF loan starting 2012 (unless it defaults on it).. So you are probably off by over $ 3 Billion

"Dealers said there were scheduled outflows of 174 billion Pakistani rupees ($1.93 billion) due on Friday."

It seems that Pakistani rupee will touch new record today after the outflow of $1.93 Billion.

 

[Capt.Popeye]

Why didn't Riaz Haq comment in this thread at all?We miss you Mr.Blogger!

Is he working on some other topics for his blog? Maybe he is busy researching World Toilet Day.