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Rupee continues losing streak against dollar

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  • Massive devastation caused by floods worsens country’s economic crisis.
  • Rupee loses Rs1.64 against the US dollar in interbank market.
  • Rupee likely to continue its downward spiral this week, traders say.

The Pakistani rupee maintained its losing streak against the US dollar at the start of the new business week on Monday, as massive devastation caused by the floods continues to worsen the country’s economic crisis.

The local unit closed at Rs229.82 after losing Rs1.64 against the US dollar in the interbank market, as per the State Bank of Pakistan.

Traders say the Pakistani rupee is expected to continue its downward spiral against the dollar in the interbank market this week as lack of strong central bank intervention and no clear strategy to turn around the economy is depressing investors.

“Emerging currencies have suffered a lot due to the appreciation of the US dollar against the major currencies following relentless Federal Reserve rate hikes and increased safe-haven demand, but the Pakistani rupee’s sharp fall of more than 4% in the last six trading sessions has fuelled investor uncertainty,” said a foreign exchange trader.

The interbank market is tracking losses in the open market. The temporary hold on imports has shifted the problem to smuggling from Afghanistan against cash dollar payments, which has increased appetite for dollars in the open market. Other secondary factors are cash forex requirements for Dubai travellers, declaration of dollars from inbound passengers, severe accessibility issues for encashing in parts of all provinces.

The difference between the Interbank and open market is creating an incentive for the foreign currency accounts (FCY) to withdraw US dollars and sell into the open market. Whereas ultra-low interest on FCY accounts is not helping in attracting fresh deposits, according to the Tresmark’s note.

Analysts do see multiple opportunities for inflows from friendly countries, bilateral institutions, and sovereigns (in the shape of flood aid). There is also a high probability that the mandate with the IMF may be increased by about $2.5 billion. But the energy crisis in Europe is going to test and stretch the global financial markets.

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The government is about to unleash another gasoline bomb on citizens beaten by inflation

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governmentThe price of petroleum products is anticipated to rise by the Federal Government starting on July 16. The price of gasoline is anticipated to rise by Rs7.67 per litre, the price of high-speed diesel by Rs3.72 per litre, and the price of kerosene by Rs2.73 per litre.

The people have informed me that a proposal to increase the petroleum levy has been created and is pending final clearance from Prime Minister Shehbaz Sharif.

After speaking with the premier, it is expected that the Ministry of Finance will declare the revised petroleum product prices tonight.

Petroleum product prices have recently surged due to rising global oil prices and Pakitsan’s adjustment of the petroleum levy in response to the International Monetary Fund’s (IMF) adamant demands, which forced the country to raise the petroleum development levy in the Finance Bill to Rs70 per litre.

Noteworthy is the fact that on July 1, the authorities also dropped a gasoline bomb.

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Positive Trend at PSX With a 1361-Point Gain for the KSE 100-Index

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In the first few hours of trading, the Pakistan Stock Exchange sees a bullish trend as the KSE 100-Index rises 1361 points, bringing the stock market to over 81,300 points.

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Significant surge in the price of gold in Pakistan

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On Friday, the price of gold in Pakistan continued to increase.

According to the All-Pakistan Gems and Jewellers Sarafa Association, the price of 24-karat gold per tola has risen by Rs2,200, reaching Rs249,000.

The price of 10-gram 24-karat gold increased by Rs1,886, reaching a total of Rs213,477. On Thursday, the cost of 10 grammes of 22-karat gold was Rs195,687.

The global gold market likewise had a rising trajectory. As per APGJSA, the worldwide rate was $2,404 per ounce, showing a decline of $24 during the course of the trading day.

The local market witnessed constant silver prices at Rs2,900 per tola.

Market observers attribute the increase in gold prices to other variables, such as volatility in the global market, currency exchange rates, and economic conditions. The ongoing surge in gold prices is likely to impact investment choices and consumer behaviour in the near future.

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