Rupee stabilises at 277/$
Exchange Companies Association president anticipated that the rupee would partially recoup losses over the next couple of days on expectations of easing political tensions. Photo: afp
Pakistani currency continued to fluctuate around Rs277 to a dollar for the second consecutive working day on Thursday, indicating that the currency was stabilising close to that level in the inter-bank market.
The State Bank of Pakistan (SBP) reported that the rupee improved 0.13%, or Rs0.37, to Rs277.04 against the greenback in inter-bank dealings.
The slight recovery came following a drop of 0.71% (Rs1.97) on Wednesday. Earlier, the currency staged a rally, surging 3.83% (or Rs10.55) to a four-month high at Rs275.44/$ on Tuesday after the government signed a long-awaited staff-level agreement with the International Monetary Fund (IMF) for a new $3 billion standby arrangement.
The open currency market tracked the inter-bank market on Thursday, where the rupee regained 0.35% of its value, or Rs1, to Rs280/$.
Experts and currency dealers anticipated that the currency may stabilise in the range of Rs270-275/$ over the next couple of weeks and come under pressure once again in the backdrop of a significantly higher demand for the US dollar for import and foreign debt payments while its supply remained limited.
They pointed out that the IMF’s first loan tranche of around $1-1.25 billion sometime in July and projected receipts of $3-4 billion in loans from other global financial institutions and friendly countries over the course of the year would partially ease pressure on the rupee.
Bank of America Securities has, however, projected that the rupee will lose another 15-25% and reach Rs340/$ in FY24.
Pakistan is expected to repay $23 billion in foreign debt in FY24, including rollovers and refinancing.
Published in The Express Tribune, July 7th, 2023.
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