Pakistani Rupee Celebrates 8th Consecutive Weekly Gain Against USD
Karobar
The Pakistani rupee (PKR) exhibited strength in the currency markets, appreciating by 46 paisa against the US dollar this week. The closing exchange rate settled at PKR 281.4 per USD, showcasing a notable improvement from the previous week's PKR 281.86 per USD.
During today's trading session, the PKR experienced an intraday high (bid) of 281.6 and a low (ask) of 281.5, ultimately closing with a gain of 27 paisa. In the open market, Exchange Companies quoted the dollar at 280 for buying and 282.8 for selling. Remarkably, this marks the eighth consecutive week of gains for the local unit against the greenback.
A significant event during the week was the brief interruption of the 13-day winning streak against the US dollar in the first trading session of 2024, resulting in a minor depreciation of 3.37 paisa. However, the PKR made a robust comeback, maintaining its upward trajectory until the last trading session.
The positive market sentiment is attributed to the anticipation of the approval of the second IMF loan tranche worth $700 million. Pakistan's inclusion in the IMF's meeting agenda for January 11, 2024, adds to the optimistic outlook.
Additionally, recent trade data from the Pakistan Bureau of Statistics (PBS) revealed a noteworthy reduction of 13.43% MoM and 40.13% YoY in the country's trade deficit for December. This improvement is linked to a substantial 9.29% MoM surge in exports and a marginal 0.55% MoM decline in imports.
In comparison to major currencies, the PKR demonstrated gains against the Euro, British Pound, Japanese Yen, and Swiss Franc, while experiencing slight losses against the Chinese Yuan, Saudi Riyal, and U.A.E Dirham.
Throughout the current financial year, the PKR has appreciated against the Dollar by 4.59 rupees or 1.63%. In the current calendar year alone, the PKR has appreciated by 46.1 paisa or 0.16%.
In the Money Market, the benchmark 6-month Karachi Interbank Bid and Offer rates marginally decreased by 3 bps to 21.13 and 21.38%. The State Bank of Pakistan (SBP) played a role in injecting liquidity into the market through reverse repo and Shariah-compliant Modarabah-based Open Market Operation (OMO), totaling Rs1.25 trillion, with Rs1.21 trillion injected through reverse repo OMO and the remaining Rs49 billion through Shariah-compliant Modarabah-based OMO.
