KARACHI, Oct 15: The rupee sank further on Wednesday to cross another psychological barrier of 80 against the US dollar.

Currency traders said that the greenback was traded at record low of Rs80.90, increase of almost Re1 in just one day.

“I fear that rupee could lose more than what it lost on Wednesday,” said Atif Ahmed, a currency dealer.

Demand for the dollars remained high while the shortage also persisted like it had been for more than 10 months.

Dealers said the rupee came under pressure when higher payments forced importers and companies to buy dollar at any cost.

“The government’s failure to generate dollars inflows from any resources amid fast evaporating reserves of the State Bank have strengthened the perception that the country’s ability to make foreign payments is in trouble,” said Atif.

The dealers said there was no hope for the improvement in the situation as the reserves of the country remained just half of what it was a year ago while the inflows of dollars were much lesser than requirement.

The only hopeful development was the rising inflows of remittances sent by the overseas Pakistanis. The remittance increased by over 25 per cent during the first quarter (July-Sept) of the current fiscal year.

Economists believe that Pakistan could receive a total $8 billion as workers remittances during the current fiscal, but trade deficit which was about $20 billion last year, is haunting the country’s economic managers.

The country needs over $3 billion per month to pay its import bill. The World Bank recently hinted that it could provide $1.4 billion assistance to Pakistan.

“Pakistan needs a breakthrough, either it should get free oil from Saudi Arabia and Iran for a year or friendly country provide sufficient dollars to keep to current account deficit in control,” said a brokerage house analyst.