Pakistan's currency plunges as it seeks IMF loan

Pakistan's currency plunges as it seeks IMF loan
In this Jan. 20, 2017, photo, villagers collect clean water from a broken water supply line in the suburbs of Islamabad, Pakistan. Pakistan says it will seek a bailout loan from the International Monetary Fund to address a mounting balance of payments crisis, Finance Minister Asad Umar said Monday. (AP Photo/B.K. Bangash, File)

ISLAMABAD (AP) — Pakistan’s currency plunged by about 7 percent on Tuesday after the government said it would seek emergency bailout loans from the International Monetary Fund.

The Pakistani rupee briefly weakened to 138 to the dollar on Tuesday before settling at 133.6. The rupee was trading at 124.3 at close of business Monday, before the announcement was made.

A Pakistani delegation will meet with IMF officials in Indonesia later this week.

After a visit last week, the IMF said Pakistan is facing significant economic challenges, with diminishing growth, high fiscal and current account deficits, and low foreign exchange reserves.

Pakistan is also seeking fresh loans from China, which is already heavily invested in its transport and energy sectors.