KARACHI:
The Pakistani currency on Thursday rose to a one-week high of slightly above Rs 285 against the US dollar in the interbank market on some improvement in foreign exchange inflows into the country.
A day ago, Saudi Arabia made available its $3 billion deposits in the State Bank of Pakistan (SBP) for one more year until the end of December 2024.
Pakistan was required to repay the funds to the kingdom next month, but the conversion is expected to ensure much-needed stability in the country’s foreign exchange reserves. Due to this, the Pakistani rupee received vital support against the dollar.
According to SBP data, the domestic currency rose 0.08% or Rs 0.22 to close at Rs 285.17 against the dollar.
Market talk revealed that the currency had briefly recovered to Rs 284.72/$ at one point of time but closed comparatively lower around Rs 285/$.
The rupee has been hovering around this level for almost two weeks now. Thursday was the third straight trading day for the currency to rise.
Market players have noted some political volatility related to the upcoming general elections scheduled for February 2024.
Reading: Saudi Arabia extends $3 billion deposit term for another year
In the open, the rupee gained 0.17%, or Rs0.50, to settle at Rs286.50 against the dollar, according to the Association of Stock Exchange Companies of Pakistan.
The currency also remained steady as foreign corporate investors returned to the Pakistan Stock Exchange (PSX), which made a cumulative net purchase of $15 million in the last four consecutive sessions, an investment seen after some time.
In the entire month of November, they infused a net $31 million into the PSX, lending critical support to Pakistan’s foreign reserves and stabilizing the rupee.
A slight fall in government bond yields ranging from five to seven basis points, in addition to the earlier decline, also indirectly boosted importers’ confidence in the currency.
Published in The Express Tribune, December 1St2023.
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