PKR falls to one-year low, dollar hits 280 mark

The U.S. dollar crossed the PKR 280 mark for the first time in nearly a year on Monday after the Pakistani rupee came under pressure due to rising imports and dismal exports.

The dollar closed at PKR 280.07 in the interbank market, showing a rise of 10 paisa from Friday's closing of PKR 279.97.

The last time the dollar was above PKR 280 was on Jan 17, 2024.

The rupee has been under pressure because of higher imports and contraction in export numbers, analysts said.

Exports in February showed a drop of 6% to $2.44 billion compared with the same month last year while imports were up by 10% to $4.7 billion, according to data from the Pakistan Bureau of Statistics.

Higher imports led to widening of trade deficit to $2.29 billion in February, up by 33% compared with the same month last year.

Consequently, this put pressure on the country's current account. In January, the current account turned into deficit of $480 million compared to December's surplus of $414 million.

However, if remittances in February remain elevated and come close to the $4 billion level in March, the current account is likely to remain in surplus on an annual basis.

While announcing the last monetary policy, State Bank of Pakistan Governor Jamil Ahmed had said that the current account would likely see a contraction or surplus of 0.5% of GDP in the entire fiscal year.