The rupee’s value plunged again on Friday with the local currency closing at a record low of Rs276.58 per dollar in the interbank market, according to the State Bank of Pakistan.

This equates to a depreciation of Rs5.22, or 1.89 per cent, from yesterday’s close of Rs271.36.

Today’s slide comes as the government continues talks with an International Monetary Fund (IMF) delegation, which is currently in Islamabad to finalise the ninth review of its $7 billion loan programme to Pakistan. If the review is successful, it would pave the way for a $1.2 billion tranche for Pakistan.

Alpha Beta Core CEO Khurram Schehzad said Prime Minister Shehbaz Sharif’s statement that the Fund delegation was giving a tough time to Finance Minister Ishaq Dar and his team during talks had lowered confidence once again and the rupee’s value declined as a result.

The rupee began its downslide on Jan 26 when it lost Rs24.54, or 10.6pc, in the interbank market after the government removed an unofficial cap on the USD-PKR exchange rate. It was the largest single-day depreciation in both absolute and percentage terms since the new exchange rate system was introduced in 1999, according to Ismail Iqbal Securities.

Since Jan 26, the rupee has lost 19.8pc of its value.

The removal of the price cap on the exchange rate was one of the conditions set by the global lender for the revival of talks on the ninth review.

Analysts termed the rupee’s depreciation a “much-needed adjustment”. The removal of the cap resulted in the interbank and open markets aligning more closely, with currency dealers now expecting a black market in dollars to eventually dry up.

The government’s decision to remove the price cap came as the country’s economic situation worsened due to servicing endless external debts and battling rising inflation.

Besides, left with only $3.09 billion in foreign exchange reserves, Pakistan can only cover 18 days of imports and desperately needs the IMF to release the next tranche of its bailout programme to head off a potential default.