Rupee Declines Against US Dollar, Other Currencies Despite Import Relief
The Pakistani rupee (PKR) reversed gains against the US Dollar and posted losses during intraday trade today.
The Pakistani rupee was initially green during the early hours of intraday trade today with the interbank rate gaining Rs. 4 to reach 279.8 by 11 AM. By 11:25 AM, it went as low as 279.3 before falling later.
At close, the PKR depreciated by 0.13 percent to close at 283.58 after dropping 38 paisas during intraday trade today.
The rupee reported losses after a long break today despite expectations of improved fundamentals following the authorities’ decision to reopen imports of the full range of goods by removing restrictions imposed on the import of 826 items from time to time between 2017 and 2022. According to a circular of the State Bank of Pakistan (SBP), the bank has removed the condition of depositing up to 100 percent payment in advance for the import of hundreds of items.
The rupee is still down over Rs. 51 since its record-breaking single-day drop of Rs. 25 in the last week of January and has since then played in mostly red due to immense economic pressure. As per exchange rate movements witnessed today, the PKR has lost over 38 paisas today, noting a fresh drop and falling near last week’s low of 284.03.
Money changers say today’s losses come amid uncertainty due to a stalemate between the International Monetary Fund (IMF) and local authorities. However, due to the Holy Month of Ramazan, cash counters are slowly adjusting to the new business hours and few gains are expected this week with the relaxation of import regulations to help improve yield hunting for dollar hoarders and traders alike.
Linking the State Bank of Pakistan’s decision to unban the import of different items with the agenda of the IMF was one more step in the direction of reviving the lender’s Extended Fund Facility (EFF).
Technically, demand for US dollars in the interbank market should fall, however, because of the small foreign exchange reserves that we hold, it is a small bet but with great returns.
The PKR was stable against some of the other major currencies in the interbank market today. It gained four paisas against the Euro (EUR), 26 paisas against the Pound Sterling (GBP), and 94 paisas against the Australian Dollar (AUD).
Conversely, it lost one paisa against the Canadian Dollar (CAD), nine paisas against the Saudi Riyal (SAR), and 10 paisas against the UAE Dirham (AED) in today’s interbank currency market.
Source: Pro Pakistani