Rupee loses 29 paisas against dollar at interbank
KARACHI: The rupee declined by 29 paisas against the dollar midday at...
KARACHI: The rupee ended flat against the dollar on Tuesday ahead of the monetary policy announcement scheduled for today, December 14, 2021, dealers said.
The exchange rate ended at Rs177.88 against the dollar from the previous day’s closing of Rs177.89 in the interbank foreign exchange market.
The dealers said the market participants were anticipating a significant increase in the key policy rate by the State Bank of Pakistan (SBP).
The SBP is issuing a second policy statement in less than a month. The central bank previously issued the statement on November 19, 2021 in which it had increased the rate sharply by 150 basis points to 8.75 per cent.
Market analysts are estimating a 100 basis points increase in the upcoming policy rate.
The dealers said the dollar demand remained higher for import payments. Similarly, inflows are not sufficient to meet the demand.
The inflows of remittances sent by the overseas Pakistanis grew 9.7 per cent to $12.9 billion during the first five months (July-November) 2021/22.
They said the large import bill was keeping the rupee under pressure. According to the official data of the Pakistan Bureau of Statistics (PBS), the import bill of the country surged 69.17 per cent to $33 billion during the first five months (July-November) 2021/22, compared with $19.47 billion in the corresponding months of the last fiscal year.
The large imports also widened the trade deficit sharply. The trade deficit during the months under review widened 112 per cent to $20.59 billion, compared with the deficit of $9.72 billion in the corresponding period of the last fiscal year.
Pakistan’s foreign exchange reserves have increased $2.652 billion to $25.151 billion by the week ended December 3, 2021. The country’s foreign exchange reserves stood at $22.499 billion by the week ended November 26, 2021.
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