Rupee inches down for second day in a row

Depreciates 0.03% against dollar in inter-bank market

KARACHI:

Pakistan’s currency continued to consolidate for the second consecutive day on Thursday, inching down another 0.03% (or Rs0.07) to close at Rs214.95 against the US dollar in the inter-bank market.

It had closed at Rs214.88 on Wednesday, according to the central bank. Cumulatively, the currency has depreciated 0.47% (or Rs1.01) in the past two days. “Rupee has remained range bound,” Tresmark Head of Strategy Komal Mansoor said while talking to The Express Tribune.

The rupee value fluctuated in a narrow band of 20 to 50 paisa on both sides of the fence throughout the last trading session.

Earlier, the rupee had cumulatively regained 10.85% (or Rs26.04) in 11 consecutive working days to touch a one-month high at Rs213.90 on Tuesday since hitting an all-time low at Rs239.94 on July 28, 2022. “Movement of the rupee hinges on the IMF (the revival of its $7 billion loan programme) and related events,” she said.

The IMF has announced that it will hold its executive board meeting on August 29, 2022 to consider the release of its next loan tranche of $1.2 billion for Pakistan.

This will be followed by inflows from other multilateral and bilateral creditors as well as friendly countries including Saudi Arabia and China. She said the rupee might see a short-lived recovery around the time the IMF approved and released the loan tranche.

“Rupee may recover to around Rs210 in the short rally,” she stressed. “However, its fair value is estimated at around Rs215-218 in the short to medium run.”

Finance Minister Miftah Ismail has announced the removal of the ban on all imports including non-essential and luxury items like expensive cars and mobile phones in compliance with the international obligations and IMF’s conditions.

Published in The Express Tribune, August 19^th, 2022.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.