KARACHI: The rupee depreciated a marginal 0.33% during the previous week, aided by recovery on the final two days to end at 281.71 against the US dollar in the inter-bank market.
An improving foreign exchange position on the back of loan inflows from Chinese institutions helped maintain the rupee’ stability, but the market remains uncertain over the crucial International Monetary Fund (IMF) programme.
During the previous week, the State Bank of Pakistan (SBP) reported that its reserves had increased $18 million, clocking in at $4.32 billion as of March 10. However, the next day Finance Minister Ishaq Dar announced the receipt of another $500 million from Industrial and Commercial Bank of China (ICBC), which was another boost to SBP’s reserves.
While the import cover now stands at around one month, the currency market will take cues from developments on the IMF front. Dar admitted that assurances from “friendly countries” to fund a balance of payment gap was the last hurdle in securing the IMF deal.
The IMF programme, which began in 2019, has faced incessant delays as Pakistan first moved to implement prior conditions of the lender including a market-based exchange rate, hike in power tariffs, additional taxation measures, and reduction in untargeted subsidies. The IMF also said that Pakistan will be required to give an assurance that its balance of payments deficit is fully financed for the remaining period of the IMF programme. These commitments have not yet realised, and reportedly remain the last hurdle in reviving the programme.
Open market rates
In the open market, the PKR lost 1 rupee for buying and 2 rupees for selling against USD, closing at 282 and 285, respectively.
Against Euro, the PKR lost 5 rupees for both buying and selling, closing at 299 and 302, respectively.
Against UAE Dirham, the PKR lost 50 paisa for both buying and selling, closing at 77.0 and 77.70, respectively.
Against Saudi Riyal, the PKR lost 50 paisa for buying and 60 paisa for selling, closing at 75.00 and 75.70, respectively.
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THE RUPEE
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Weekly Interbank market rates for dollar
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Bid Close Rs. 281.70
Offer Close Rs. 284.00
Bid Open Rs. 280.75
Offer Open Rs. 283.75
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Weekly Open market rates for dollar
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Bid Close Rs. 282.00
Offer Close Rs. 285.00
Bid Open Rs. 281.00
Offer Open Rs. 283.00
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Copyright Business Recorder, 2023