KARACHI, July 5: The rupee crossed Rs70 to the dollar on Saturday, the weakest level ever, due to rise in dollar demand from importers and the country’s uncertain economic and political uncertainty.

The rupee closed at a record low of Rs70.13/18 to the dollar, compared to Friday’s closing of Rs69.55/60.

The rupee is now beyond levels last seen in late May, when a precipitous fall prompted the central bank to take steps to stabilise the currency and dampen speculation.

There has been a steady drip in foreign currency reserves since then because of the strong demand for dollars from importers, particularly oil buyers.

The rupee has dropped 13.8 per cent this year as the economy feels the brunt of rising oil and food costs.

Pakistan’s annual inflation has jumped to a three-decade high and it is facing widening fiscal and current account deficits.

“There was an increase in demand for dollars from importers,” said a currency dealer.

“But we also have a widening trade deficit, high inflation so it’s really our fundamentals which are not intact, along with political uncertainty.”

Traders said central bank intervention would stabilise the rupee in the short run but State Bank’s reserves are running low.—Reuters