Rupee hits new 5-month high at 278.74/$

KARACHI:

The Pakistani currency edged up to a new over five-month high at Rs278.74 against the US dollar in the interbank market, maintaining an uptick for the third consecutive working day, fuelled by relatively better supply of the greenback in the domestic economy.

According to the State Bank of Pakistan’s (SBP) data, the domestic currency improved by Rs0.03 against the foreign currency on a day-to-day basis on Friday.

The local currency has cumulatively strengthened by 10.17% or Rs28.36 over the past six months compared to its all-time low of Rs307.10/$ in the first week of September 2023. The Exchange Companies Association of Pakistan (ECAP) reported a Rs0.01 increase on a day-to-day basis, closing at Rs281.25/$ in the open market.

Read: Rupee stabilises at five-month high amid IMF talks

The currency received a boost from a $17 million increase in the country’s foreign exchange reserves (held by the SBP), which rose to $7.9 billion, according to the central bank’s weekly update on Thursday.

The increase in reserves confirms that the supply of foreign currency has remained higher than demand in the system, as exporters continued to sell higher amounts of US dollars on futures counters. Additionally, overseas Pakistanis maintained sending higher funds to their family members and friends in the homeland during the ongoing fasting month and ahead of the Eid festival.

Published in The Express Tribune, March 16^th, 2024.

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