A money changer shows banknotes of U.S. dollar in southern Pakistani port city of Karachi on May 21, 2022. (Str/Xinhua)
Pakistani experts believe that the delay in the release of loan facility from the International Monetary Fund, depleting forex reserves and recent negative Fitch rating on Pakistan created a temporary economic crisis in the country.
ISLAMABAD, July 22 (Xinhua) -- With the rupee hitting a record low level, losses at the Pakistan Stock Exchange (PSX), high inflation and low forex reserves of the country recently, Pakistani experts on Thursday called for necessary measures for economic upturn amid political and economic challenges.
The downward spiral of the Pakistani rupee continued on Thursday for the fourth consecutive day of the week, with the currency closing at a historic low of over 226 rupees against the U.S. dollar.
The rupee closed at 224.92 on Wednesday. However, according to the country's central bank, it slid by 0.83 percent against the greenback to touch 226.81 rupees on Thursday.
Federal Minister for Finance and Revenue Miftah Ismail said on Wednesday that the current downturn of the rupee against the U.S. dollar was not due to economic fundamentals but because of political uncertainty.
Besides the local currency, the PSX also remained under massive pressure, with all the major indexes landing in a red zone this week as investors offloaded their stockholdings amid selling pressure.
The PSX's benchmark KSE 100-Index went down by 1.55 percent or 627.95 points to close at 39,831.75 points on Thursday compared with 40,459.70 points reported on Wednesday.
Pakistani experts believe that the delay in the release of loan facility from the International Monetary Fund (IMF), depleting forex reserves, recent negative Fitch rating on Pakistan from stable to negative, and domestic political upheaval created a temporary economic crisis in the country.
Former prime minister Imran Khan-led Pakistan Tehreek-e-Insaf, who was ousted from power through a no-confidence motion in April, bagged more seats in recently held by-polls in the largest Punjab province than the incumbent government political parties, creating political uncertainty in the country.
Talking to Xinhua, Farhan Bokhari, an Islamabad-based political economist, said that the recent developments on the economic and political fronts demand special steps to cushion common citizens struggling from record-high inflation, unemployment and diminishing purchasing power.
"Loan facility from the IMF under the recent agreement between Pakistan and the IMF and funds from other sources will ease pressure on the rupee and forex reserves," he said, adding that it is high time for the government to make reforms and policies for minimum reliance on foreign financial institutions for loans.
Bokhari said that all politicians including the government and the opposition should put their political differences aside and need to work together for economic and political stability in the country.■
