Pakistan's rupee drops to record low on reports IMF tranche talks failed

Pakistan’s rupee hit a record low on Monday of 173.20 in intra-day trading against the dollar before closing at 172.78, below the previous close of 171.18, after reports of a failure of talks with the International Monetary Fund, traders said.

The government's finance ministry on Monday dismissed reports by local media over the weekend that talks from October 4 to 15 for the release of a $1 billion loan tranche were inconclusive.

“Negotiations between Pakistan and IMF are moving forward positively. No timeframe was set at any stage for the conclusion of the talks,” the finance ministry said. In June, a similar round of talks between the two sides had failed. 

Last month, Fitch Ratings revised down its forecasts for the Pakistani rupee for both this year and next due to a variety of factors, including an increased flow of US dollars into neighbouring Afghanistan.