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KARACHI: The currency's volatile ride continued as after successive gains Pakistan's rupee was back to its losing ways against the US dollar, closing over the 175 level at the inter-bank market on Wednesday.
As per the State Bank of Pakistan (SBP), the PKR finished at 175.04 against the USD after a day-on-day depreciation of 74 paisas or 0.42%. On Tuesday, the rupee had closed at 174.30 against the dollar in the inter-bank market.
The drop comes after the rupee had registered back-to-back gains on Monday and Tuesday, appreciating over 0.5%.
The gains came after the currency market got a sense of direction as Pakistan finally reached a staff-level agreement with the International Monetary Fund (IMF).
However, the gains did not last a third session.
“The upward movement of PKR against the USD is due to supply-demand movement in the market, as the exchange rate is market-determined,” Samiullah Tariq, head of research and development at Pakistan Kuwait Investment Company (Private) Limited, told Business Recorder.
Tariq said the IMF announcement did create a positive sentiment in the market, but the economy continues to battle the current account deficit (CAD), suggesting high demand for the dollar.
Pakistan’s current account deficit widened to $1.66 billion in October 2021 from a surplus of $448 million recorded in the same month last year. On a monthly basis, CAD widened 46% as compared to $1.13 billion recorded in the previous month (September 2021).
Tariq added that the CAD for the upcoming month is expected to be lower, amid import-curtailing measures taken by the authorities, which would ease pressure on the rupee.
“Furthermore, export figures are expected to improve on the back of an increase in cotton price. Measures taken by the government will take some time to reflect."
Open-market movement
In the open market, the PKR lost 75 paisas for buying and 50 paisas for selling against USD, closing at 176.75 and 177.50, respectively. This broke the spread of one rupee between buying and selling that had been maintained for some time.
Against Euro, the PKR gained 50 paisas for both buying and selling, closing at 196.50 and 198, respectively.
Against UAE Dirham, the PKR gained 20 paisas for both buying and selling, closing at 49.50 and 50, respectively.
Against Saudi Riyal, the PKR remained unchanged for buying while losing 30 paisas for selling, closing at 46.40 and 47, respectively.
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Open Bid Rs 176.75
Open Offer Rs 177.50
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Interbank Closing Rates: Interbank Closing Rates For Dollar on Wednesday.
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Open Bid Rs 175.00
Open Offer Rs 175.20
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RUPEE IN LAHORE: The Pak rupee depreciated its worth on the buying side while it stayed unchanged on the selling side in relation to the US dollar in the local currency market on Wednesday.
According to the local currency dealers, the dollar significantly gained its worth against the greenback for buying and closed at Rs 176.20 against the overnight closing rate of Rs 175.50 whereas it did not witness any change for selling and firmly closed for selling at Rs 177.00.
On the other hand, the rupee failed to continue its gaining streak ad it drastically declined its worth in the process of trading against the pound sterling. The pound’s buying and selling rates rose from Tuesday’s closing of Rs 232.00 and Rs 233.60 to Rs 233.30 and Rs 235.00, respectively, they added.
Copyright Business Recorder, 2021
