For the past quite some time, Pakistani rupee is getting devalued against Dollar, and on Monday 11-12-2017 US Dollar saw an increase of PKR 3, climbing to Rs.110 creating panic in the local market. The purpose of writing this article is to give auto enthusiasts a clear picture of what would happen if rupee keeps losing its ground against Dollar.
Now coming to the topic, the rupee is facing bashing from Dollar, local traders and currency analysts are blaming SBP (State Bank of Pakistan) for this and arguing that SBP itself is devaluating rupee against Dollar to appease IMF (International Monetary Fund). SBP responded and negated this argument with currency dealers also backing the stance of SBP.
Aside from this tussle between traders and SBP, if the rupee gets devalued against Dollar the things which Pakistan import will get expensive such as crude oil, auto parts, and cars?
According to some analysts, the car manufacturers might increase the price of CBU (Completely Built Unit) vehicles as well as the price of locally assembled passenger cars by 8 to 10 percent. Most of the auto parts involved in the assembling of vehicles are being imported and if the Dollar keeps on getting stronger than it is quite possible that price of cars might even get higher in the country.
Moreover, it is also being rumored that due to the devaluation of rupee car manufacturers have already geared up and is planning to increase the price of cars in few days and will issue new prices in this regard. Furthermore, not only the prices of cars might go up but also the price of Oil as well.
There has been a hike in the price of Petrol, Diesel, and Kerosene oil for the past couple of months and it seems that now due to the devaluation of rupee, oil might get more expensive in the country, which will put more economic pressure on the people. It is expected by analysts that the oil prices might go up by 7 to 10 percent.
The government has recently strengthened its policies for importing a vehicle to stop rupee from getting devalued. In my opinion, the government should do more in this regard.
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