KARACHI: As Pakistan’s national currency on Thursday hit an all-time low of Rs295 against the US dollar in the interbank market, currency dealers said some “opportunistic elements” in the financial sector were minting money by benefiting from the current political situation.
Political turmoil in Pakistan intensified this week, as protests erupted in different parts of the country following former ex-PM Imran Khan’s by the country’s anti-graft body on corruption charges.
The political situation in the country of 220 million people worsened at a time when it was already reeling from one of the worst economic crises in history, with its foreign exchange reserves falling to critically low levels, inflation running at over 36 percent, and an expected International Monetary Fund (IMF) bailout being delayed for months.
According to the Exchange Companies Association of Pakistan (ECAP), the rupee was trading at Rs295.09 against the greenback in the interbank market on Thursday while the currency in the open market hit the Rs300 mark.
“Some opportunistic elements in the financial sector are benefitting from the current political turmoil in the country,” Zafar Sultan Paracha, ECAP secretary-general, told Arab News.
Currency dealers said the impact of the political crisis was usually reflected in the stock exchange trading, but such a phenomenon was rarely witnessed in the currency market.
“This is happening for the last one-and-a-half year, which is unprecedented in the 75-year history of Pakistan,” Paracha added. “We have been drawing the attention of the authorities [to this] but no one has paid any heed.”
He further said that the State Bank of Pakistan (SBP) had initiated a probe against some banks that were involved in currency manipulation but the findings had not been made public.
