After 29 successive losses, rupee sees some gain, settles at 267.89 against US dollar

After depreciating for 29 successive sessions that featured massive falls since Thursday last week, the Pakistani rupee saw some improvement against the US dollar, closing with a 0.65% gain on Tuesday.

As per the State Bank of Pakistan (SBP), the currency settled at Rs267.89, an appreciation of Rs1.74 against the US dollar.

On Monday, Pakistan’s rupee had witnessed significant depreciation, settling at 269.63 after a fall of Rs7.03 or 2.61%. This was its weakest inter-bank closing level in history.

However, the improvement comes after the International Monetary Fund (IMF) team reached Islamabad led by director Nathan Porter.

Business Recorder reported that technical-level meetings are starting today (Tuesday) and would continue till Friday, which will be followed by policy-level talks.

An official on condition of anonymity said that there is no other option but to implement the agreed conditions and implement structural reforms in the power sector. He further stated that the government has to increase electricity and gas prices and would have to impose taxes as the gap between revenue and expenditure has been increasing.

Experts have termed resumption of the IMF programme crucial for the cash-strapped economy, which has seen its foreign exchange reserves fall significantly in recent months.

The Finance Division also confirmed that a meeting was held between the IMF mission and Finance Minister Ishaq Dar. The meeting discussed economic and fiscal policies and reforms agenda to accomplish the 9th review under the Extended Fund Facility.

Internationally, the dollar was eyeing a fourth monthly loss on Tuesday as investors reckon a peak in US interest rates could swing into view as soon as this week’s Federal Reserve meeting.

Currency trade was subdued in the lead up to Wednesday’s Fed rate decision, and ahead of Bank of England and European Central Bank rate decisions on Thursday, though cautiousness across financial markets lifted the greenback a little bit overnight.

The US dollar index is down 1.3% for January so far, though it rose 0.3% to 102.19 overnight.

Oil prices, a key indicator of currency parity, steadied in early Asian trade on Tuesday after falling by more than 2% in the previous session on the threat of further interest rate hikes and continued Russian crude flows.

Inter-bank market rates for dollar on Tuesday

BID Rs 268

OFFER Rs 270

Open-market movement

In the open market, the PKR lost 1.50 rupees for both buying and selling against USD, closing at 273.50 and 276.50, respectively.

Against Euro, the PKR remained unchanged for buying while gaining 50 paisas for selling, closing at 293 and 295.50 respectively.

Against UAE Dirham, the PKR gained 20 paisas for buying and 30 paisas for selling, closing at 74.50 and 75.20, respectively.

Against Saudi Riyal, the PKR remained unchanged for both buying and selling, closing at 72.80 and 73.50, respectively.

Open-market rates for dollar on Tuesday

BID Rs 273.50

OFFER Rs 276.50