International Credit Rating Agency Fitch downgraded its outlook for the Pakistani rupee on Thursday for both this and next year due to a number of factors, including an increase in US dollar outflows from Pakistan into neighboring Afghanistan.

Fitch predicted that the average rupee rate this year would now be $ 164 per dollar, up from $ 158 earlier forecast. Fitch now expects an average rate of PKR 180/US$ for 2022, up from the previous forecast of 165.

“Our expectations for continued weakness in the currency are based on deteriorating Pakistani trade relations, tightening US monetary policy and US dollar outflows from Pakistan to Afghanistan,” the report said.

The Pakistani rupee has been falling steadily since May. It depreciated to Rs. 170.50/US$ on Thursday, more than 10% below the May high of 150.95.

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