Indian and Pakistani rupee feeling the pinch

Muscat: The Pakistani rupee (PKR) and Indian rupee (INR) are under extreme pressure after both currencies gained strength earlier this year.
The Pakistani rupee, which previously traded at PKR358.5 in January 2019 against an Omani rial (OMR), has drastically depreciated and is now trading at PKR376. The Indian rupee is hovering around INR182, but was previously trading at INR180.7 at the beginning of the year, according to a general manager at Mustafa Sultan Exchange.
Both PKR and INR have been at an all-time-low against the Omani rial last year, trading at INR193.15 and PKR359 to one OMR due to political stability and oil prices back in the respective countries. However, PKR depreciated comparatively more following Pakistan’s agreement with the International Monetary Fund to secure a $6 billion bailout on May 12.
Speaking exclusively to Times of Oman, P.K. Subudhi, General Manager at Mustafa Sultan Exchange, said: “PKR is highly volatile now, and has depreciated drastically to PKR376 against one Omani rial. This is mainly on account of the IMF bailout that happened recently. “Moreover, INR is hovering around INR182 levels mainly on account of higher oil prices and global uncertainties like a trade war and Iran
sanctions.
“While it’s difficult to predict the levels, PKR may depreciate further in the near future, and this will definitely result in a higher flow of remittances to Pakistan.”
Boban M.P., CEO, Oman UAE Exchange, said that the Pakistani currency declined by nearly 3 percent on Thursday and reached an all time low. “This decline was triggered by the concerns about the strict curbs imposed by IMF while agreeing to grant a $6bn loan to Pakistan to avert economic crisis.
“According to market information, free float of currency (free from State control), is a major reason for this fall, and is among other strict conditions imposed by IMF. If free float is implemented, the currency may fall further in the near future.”
Another exchange expert in the Sultanate said that the Indian rupee is under pressure this week.
“The decision on oil imports from Iran, poll result, etc, will give directions on rupee. Exit poll results will be announced soon. If the ruling government cannot win an absolute majority, then the rupee is likely to slide against the dollar in the short term,” said R Madhusudhan, CEO of Global Exchange.
“Again, it depends on multiple domestic reasons like GDP growth and inflation,” said R Madhusudhan.