KARACHI
Pakistani rupee maintained its winning streak against the US dollar for the 26th consecutive session in the inter-bank market on Thursday with an appreciation of 93 paisas.
The State Bank of Pakistan (SBP) said in a tweet that the rupee opened at 279.51 against the dollar in the interbank market and closed at 278.58, showing an appreciation of 0.33 percent.
The ongoing appreciation marks the longest ever winning streak of the local unit against the greenback. The rupee has advanced to the highest level of the current fiscal year 2023-23. The currency surged more than 6 percent in the past month to become the top performer in the world. The rupee has appreciated by Rs7.41 during the current fiscal year 2023-24, while it has depreciated by Rs49.16 in the current year.
Similarly, the local unit appreciated by Re1 against the greenback in the open market. The rupee was quoted in the range of 275-278 a dollar against 276-279 a session earlier. The rupee has appreciated by Rs54 in the last 27 sessions in the open market.
The market experts said the government’s crackdown in the open market against currency speculators and hoarders helped rupee’s recovery. However, the room for further improvement is narrowing as the Real Effective Exchange Rate (REER) is nearing 100. They further said that the currency remains fundamentally vulnerable, as the country has yet to see a significant increase in exports and remittances, while imports remain high.
The local currency has significantly gained in the past five weeks, with analysts attributing the rise to an ongoing crackdown on illegal dollar outflows. Currency dealers said that exporters have been selling dollars on a large scale, fearing further devaluation.
The reports of increased vigilance of the Afghan transit trade also contributed to the rupee’s rise.
The Ministry of Commerce recently took a decisive step by imposing a ban on 212 items that were previously being imported into Afghanistan via Pakistan under the Afghan transit trade agreement. Additionally, the FBR has imposed a 10% processing fee on five major categories of Afghan transit commercial goods imported into Afghanistan through Pakistan.
In a related development, the workers’ remittances increased by 5.34 percent on a month-on-month basis in September to $2.21 billion against $2.09 billion in August amid improved transparency coupled with stringent measures against dollar smuggling, the latest data issued by SBP revealed. However, workers’ remittances decreased by 11.3 percent on a yearly basis as compared to $2.49 billion in the same month last year. Overall, the total remittances stood at $6.33 billion in the first quarter of 2023-24 as compared to $7.9 billion in the first quarter of 2022-23, showing a fall of 19.85 percent.
