KARACHI: Pakistani rupee continued its losing streak against the US dollar in the inter-bank market for the eighth straight session and depreciated by Rs1.18 (-0.42 percent) on Wednesday. The State Bank of Pakistan (SBP) said in a tweet that the rupee opened at 281.47 against the dollar in the interbank market and closed at 282.65. The rupee has appreciated by Rs5.34 during the current fiscal year 2023-24, while it has depreciated by Rs51.23 in the current year. The rupee gained Rs6.26 (+2.23 percent) against the greenback in the month of October. However, the Pakistani rupee depreciated by Re1 against the greenback in the open market. The rupee was quoted in the range of 281-284 a dollar as compared to 280-283 in the previous session. The rupee has recovered by Rs48 against the dollar in the last 41 sessions in the open market. The recent fluctuation comes after a remarkable 28-day winning streak for the Pakistani currency, which concluded on October 17, 2023. The rupee had fallen to a record low of Rs307.09 a dollar on September 5. But following a crackdown by agencies on illegal foreign exchange trading and structural reforms introduced by the central bank, the rupee had recovered every day in the interbank market since then. TLTP
The gap between rates in the interbank and open markets is required to be less than 1.25 percent under one of the structural benchmarks set by the International Monetary Fund (IMF).
The IMF mission, led by Nathan Porter, will visit Pakistan on Thursday to discuss the first review of the country’s $3 billion standby arrangement (SBA).
Though the finance ministry is confident about the successful completion of the SBA review, external financing needs may come under sharp focus during the review, as the budgeted $4.5 billion loans from foreign commercial banks and $1.5 billion through issuance of Eurobonds for the current fiscal year have yet to be materialized. A successful review is crucial to pave the way for further inflows into the country, which deals with low foreign exchange reserves.
Meanwhile, the country’s foreign exchange reserves fell by $220 million on a weekly basis, with the total now standing at $7.494.2 billion. The SBP in its report attributed the reason for this substantial decrease to debt repayments. The total liquid foreign reserves held by the country, including the reserves held by commercial banks, stood at $12,655.6 million. Commercial banks held reserves of $5,161.4 million.
