Pakistan rupee at record low amid flight of dollars to Afghanistan

Pakistan’s rupee dropped to a record low on Wednesday to close at 169.12 against the US dollar, a depreciation that some currency dealers blamed on an outflow of dollars to neighboring Afghanistan, where the banking system has been in disarray since US and allied troops withdrew and the Taliban took over.

The Pakistani rupee has lost around 9 per cent against the dollar in last four months.

On Tuesday, the dollar hit a previous high of 168.94 rupees, shattering investors’ confidence in the unit and exchange rate stability.

The rupee has been losing purchasing power rapidly in the domestic market, causing a rise in inflation that has badly hurt consumers.

“At present, around 25 per cent dollars (of the total available in Pakistan) is going to Afghanistan from Pakistan’s northwestern city of Peshawar,” Malik Bostan, chairman currency traders association told Hum News, a private news channel.