Rupee gains Rs3.11 against dollar in interbank market

Rupee gains Rs3.11 against dollar in interbank market

Rupee gains Rs3.11 against dollar in interbank market

Rupee gains Rs3.11 against dollar in interbank market

Advertisement

KARACHI: The rupee continued its gaining momentum for the third consecutive session against the dollar on Tuesday, as Ishaq Dar’s likely appointment as the new finance minister boosted investors’ confidence, dealers said.

The exchange rate witnessed a gain of Rs3.11 to reach Rs233.91 against the dollar from the previous day’s closing of Rs237.02 at the interbank exchange market.

Analysts said that the rupee continued its flight against the dollar for the third consecutive session as the arrival of Dar has boosted the sentiments of the domestic market and it is hopeful that the economy will return to normalcy soon.

Dar is well-known for artificially jacking up the rupee, however the current gaining momentum is likely to be short-lived as the absence of economic fundamentals and the economic and political conditions remain uncertain, they added.

The expected inflows of the foreign currency in the future from multilateral institutions and friendly countries to help Pakistan fight against flood losses also helped the rupee regain its ground.

Advertisement

The government secured some economic support from Saudi Arabia, to provide the required stability to the exchange rate.

The Saudi Fund for Development (SFD) has confirmed a rollover of a $3 billion deposit maturing on December 5, for one year. The deposit is placed with the SBP and is part of its foreign exchange reserves.

An ease in the current account deficit was also witnessed during the current fiscal year. Pakistan’s current account deficit shrank 19 per cent during the first two months of the fiscal year 2023 due to a lower import bill and increase in exports.

Cumulatively, the country recorded a current account deficit amounting to $1.92 billion in the first two months of ongoing fiscal year, compared with $2.37 billion in the same period of last fiscal year, depicting a decline of $456 million, a report by the State Bank of Pakistan (SBP) showed.

The decline in the current account deficit is due to an 11 per cent surge in exports and around 2 per cent contraction in the import bill, the central bank said.

The foreign exchange reserves of the country have also recorded a decline on the back of less inflows and higher imports.

Advertisement

The foreign currency reserves held by the State Bank of Pakistan (SBP) recorded a decline of $278 million to reach $8.34 billion during the week ended September 16, compared with $8.62 billion on September 9.

The overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $14.06 billion. The net reserves held by banks amounted to $5.72 billion.

The local currency remained under pressure since the start of the current fiscal year. The rupee lost Rs29.06 or 14.18 per cent from Rs204.85 to dollar on June 30, 2022 to the current level of Rs233.91.

At the open market, the buying and selling of the dollar was recorded at Rs232.5 and Rs235 at 4:00pm PST.

Advertisement
Advertisement

Catch all the Business News, Breaking News Event and Latest News Updates on The BOL News


Download The BOL News App to get the Daily News Update & Follow us on Google News.


End of Article

Next Story