Pakistan rupee hits record low, no news on lifeline

Pakistan’s rupee plunged almost five percent to a record low Friday after what appeared to be a sixth devaluation by the central bank in the past year as the country struggles with an acute balance of payment crisis. The unit sank to 143 rupees against the dollar just a day after Prime Minister Imran Khan’s government celebrated 100 days in office with a televised conference boasting of its achievements.

The State Bank of Pakistan has indirectly devalued the state-managed unit several times already as it tries to narrow a huge balance of payments deficit. But traders are growing concerned that neither Khan nor his Finance Minister Asad Umar laid out a comprehensive plan to address the country’s economic woes more than a week after negotiations with the International Monetary Fund ended without a much-needed bailout agreement.

The rupee has lost about a third of its value since the start of the year as Pakistan struggles with chronic inflation as it burns through its dwindling foreign currency reserves, which are down around 40pc this year. Pakistan secured $6 billion in funding from Saudi Arabia and struck a 12-month deal for a cash lifeline during Khan’s visit to the kingdom in October. The IMF and World Bank forecasts suggest the Pakistani economy is likely to grow by four to 4.5pc for the year fiscal year ending June 2019 compared to 5.8pc growth in the last fiscal year.