141 Global News Post 2
mustafa zafar
Global Post #2
https://www.cnn.com/2023/01/26/investing/rupee-drops-markets-adjust/index.html by Fayaz Aziz/Reuters
[Photograph of a Pakistani rupee in Peshawar, Pakistan]. (Dec 2018).
https://www.cnn.com/2023/01/26/investing/rupee-drops-markets-adjust/index.html
Pakistan is in deep crisis due to their rupee that fell in one day which is the biggest drop seen in over two decades according to this article. Due to the sudden decrease, Pakistan has been desperate for external finances to help cover their imports which fell from “$923 million to $3.68 billion” (Aziz, Reuters, Jan 2023). The article also discusses how other countries helped Pakistan due to floods in 2019 but they have stopped since the country hasn’t made any progress on fiscal consolidation.
However, with the losses, the Pakistan stock exchange reacted positively to the fall of rupees with the spread of open market rates and black markets created for dollars due to low supply. Overall, the banks have been hit the hardest as the dollar has increased the prices for the rupee.
The article, CNN, did not talk about the reason why the rupee fell drastically or the measures that Pakistan is taking to work on it other than asking for help. The article does not have included links that share the detail about why the rupee fell is the highest drop seen in so long. The article mentions how the economic crisis is pulling political pressure on the government and how the government is demanding a general election. This might mean that a new prime minister might be needed to solve the economic deficits.